Kenneth Frazier, the Merck boss taking a stand against racial injustice

It was not the type of interview the CNBC audience is accustomed to. At 8am on Monday, Kenneth Frazier, the chief executive of drugmaker Merck, used an appearance on America’s main business TV network to address the killing of George Floyd.

His voice cracking with emotion, Mr Frazier, a lawyer by profession, forensically dissected the facts surrounding Floyd’s death as though he were standing in front of a jury in a courtroom. Derek Chauvin was a 19-year veteran of the Minneapolis police force, he said. While kneeling on Mr Floyd’s neck for almost nine minutes, his face expressionless, the officer had kept his hands in his pockets — a clear sign he knew he was not at risk.

“This African American man, who could be me or any other African American man, was being treated as less than human,” said Mr Frazier.

For four days thereafter, state officials had done nothing. “No one thinks that this is worthy even of putting the officer under arrest . . . until [the community] went out into the streets,” he added.

It was a remarkable intervention for a chief executive who has assiduously avoided publicity. Even as the company’s best-selling drug, the cancer immunotherapy Keytruda, has drastically improved survival odds for thousands of people, Mr Frazier has tended to take a back seat, leaving the company’s top scientists to trumpet the medicine’s benefits.

But his remarks on Floyd’s death were not without precedent. In August 2017 Mr Frazier quit Donald Trump’s American Manufacturing Council after the president’s equivocal response to a wave of white nationalist violence in Charlottesville, Virginia.

“America’s leaders must honour our fundamental values by clearly rejecting expressions of hatred, bigotry and group supremacy,” Mr Frazier wrote on the company’s Twitter account at the time. “As CEO of Merck, and as a matter of personal conscience, I feel a responsibility to take a stand against intolerance and extremism.”

Mr Frazier’s interventions are all the more powerful for their rarity. After resigning from Mr Trump’s council, he did not comment further on his decision for six months. Since his appearance on CNBC, he has refused all other media requests.

His ascent to the top of one of the US’s foremost drugmakers is the kind of story that is all too rare in corporate America. His father was a caretaker in Philadelphia, his grandfather born into slavery in the Deep South.

He joined Merck in 1992 as general counsel of a joint venture between the US drugmaker and Astra, the Swedish half of today’s AstraZeneca. Dr Roy Vagelos, chief executive of the drugmaker until 1994, said Mr Frazier was hired because he was “smart and decisive” but also recalls that he was impressed by the lawyer’s commitment to social justice.

While at Drinker Biddle, the law firm where he started his career, Mr Frazier had worked pro bono to overturn the conviction of James Willie “Bo” Cochran, who was released in 1997 after 19 years on Alabama’s death row for a killing he did not commit.

Mr Frazier eventually became Merck’s overall general counsel in 1999 and was the architect of a hard-nosed strategy in which the drugmaker defended itself against a wave of litigation related to Vioxx, an osteoarthritis drug that increased a person’s chances of suffering a heart attack or stroke. Rather than rolling all the legal action together and resolving it with a global settlement, he decided to fight each lawsuit one by one.

“He won a majority of cases and that saved an enormous amount of money for the company and its stockholders,” said Dr Vagelos. “It was critical to the future of the company.”

Mr Frazier, who was appointed chief executive in 2011, is a staunch free marketeer. In 2018 he told a group of students at Stanford that capitalism was “the best economic system in the world”, even if it led to some “economic inequality”. He has consistently raised the price of prescription drugs, arguing this is needed to fund research and development.

What he cannot abide is social injustice. Steve Reinemund, the former PepsiCo chief executive who sits on the board of ExxonMobil alongside Mr Frazier, said the Merck chief executive had decided to speak up after Charlottesville and Mr Floyd’s death because he felt a line had been crossed.

“He is quite comfortable keeping private until something passes his threshold of acceptance,” he said. “If he comes out strongly, it’s because it has crossed his tolerance.”

Although Mr Frazier’s interventions are impassioned, they are the product of much planning, according to Les Brun, Merck’s lead independent director.

“He does not do this off the cuff: there is a tremendous amount of consultation that goes on between myself and Ken and other members of the board before he takes a position he feels is personally important,” said Mr Brun.

Dr Vagelos said that once he has decided to act, Mr Frazier has little regard for the potential fallout. “When he walked out on the president, he did so not caring about possible retributions or consequences.”

Mr Trump did end up attacking Mr Frazier in a tweet after he left the manufacturing council. “It was blowback that was worn as a matter of pride,” said Mr Brun.

Mr Frazier also believes that if a prominent executive does speak up, it is important that they do not mince their words, according to Kenneth Chenault, the former chief executive of American Express. “If you’re strongly driven by your values and beliefs, you’re not going to be mealy-mouthed,” he said.

Mr Frazier said as much during his CNBC interview when he criticised the boilerplate responses of other companies to the killing of Floyd. “People put out statements, they put out platitudes, they say this is terrible. The fundamental question is, do we do more than we’re required?”

Inside Merck, the question is what Mr Frazier does next. After almost a decade at the helm, he will turn 66 in December, a year above the company’s traditional retirement age.

Dr Vagelos hopes he will run for political office. “I happen to think he’d be a great candidate for president, although I don’t know if I can convince him,” he said. “I plan to bring it up next time I see him.”