The CEO of Merck says he got the best advice of his life from his father and it helped him turn the company into a $210 billion drug giant
- As a young teenager growing up in inner-city Philadelphia, Kenneth Frazier's father gave him the "single most important piece of advice" in his life.
- Frazier would end up going to Harvard Law School and today heads the $210 billion US drug giant Merck.
- The advice would help Frazier make unpopular decisions, including to invest in research and development at Merck and quitting President Donald Trump's business council after a white supremacist rally in Charlottesville.
Kenneth Frazier, the 64-year-old longtime CEO of US drug behemoth Merck, got what he calls the "single most important piece of advice I've ever been given in my entire life" around age 13.
And the whole thing started over, of all things, sneakers.
Frazier, who is today one of just three black CEOs in the Fortune 500, grew up in inner-city Philadelphia. His dad worked as a janitor and, when his mother died young, raised Frazier and his siblings on his own.
When Frazier was a young, basketball-playing teenager, the popular style of athletic sneaker shifted - from high-top canvas to leather. Frazier was the last of his friends to still be shod in the out-of-favor style, and people were making fun of him for it. He came home one day complaining, and said he was going to quit the sport.
His father, Otis, was a stern, exacting man, and a giant in Kenneth's life. But he seemed sympathetic, at least initially, expressing concern about his son being unpopular.
He even offered to buy Kenneth new shoes, going so far as to count out the money. But it was a trick. Instead of new shoes, Kenneth would get a drubbing from his father - and guidance that today still stands as "the single most important sentence that has ever been uttered in my life."
"He said, 'Kenny, what other people think about you is none of your damn business.' And the sooner you learn that, he said, the better off you'll be," Frazier recounted recently, during an intimate and wide-ranging speech at the New York City Bar last week.
That advice would be a touchpoint for Frazier for decades to come, he said, ringing in his ear to this day. And it would steer him to make a crucial set of decisions early in his tenure at Merck, he recalled, ones that were pivotal in making the drugmaker the dominant, cancer powerhouse of a company it is today.
'I just had to tune out all the critics'
A Harvard Law School graduate, Frazier started off his career at a law firm, where one of his clients was Merck. He later moved over to the drug company, where he worked for nearly 20 years before starting as CEO in 2011.
"I became CEO at a time that pressure to cut R&D was immense," he said, referring to Merck's investments into researching and developing innovative new medications. "And, you know, everybody wants to be liked, including by your shareholders and in your board."
But just a month into the gig, Frazier made a decision he knew would be unpopular with almost everyone. Years before, Merck had released long-term financial expectations that called for high-single-digit annual profit growth.
But Frazier withdrew those expectations, saying that they would require big cuts to new drug research, ones that he was not willing to make. It came as an unwelcome surprise to investors, and Merck shares dropped at the time.
At the time, the decision also compared unfavorably to that of rival US drug giant Pfizer, which at the time cut a staggering $2 billion from its research budget and laid off thousands of researchers to meet its financial goals.
"And when I look back at that, and I don't want to pat myself on the back - I did the right thing for the right reason. I knew what this company was about was the science, and I, I just had to tune out all the critics," Frazier said.
Standing up to President Trump
And the advice hasn't just served Frazier in the business world, he said.
Frazier became even more well-known two years ago. At the time, white supremacists had gathered for a violent, deadly rally in Charlottesville, Virginia, but President Donald Trump would not denounce white supremacy.
"And to the point of these hard decisions, I hear [my father]. The critics are all around you. 'You shouldn't withdraw from this situation with the president because you'll be tweeted at,'" he said.
"I can hear [my father] right now saying that's none of your damn business, and I think that people don't really get that."
- K'taka Assembly passes supplementary budget of Rs 10,265 crore
- Sports NFT platforms have racked up nearly $1 billion in funding this week alone, despite market slump
- COVID-19 virus likely to get weaker and become a common cold, says Oxford-AstraZeneca vax creator
- Best teether for growing baby in India
- TiE Delhi-NCR kickstarts the 10th Edition of India Internet Day themed Digital India: Escape Velocity