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Executive Vice President and CFO
Merck & Co., Inc.
Whitehouse Station, N.J.

In her 25-year career at Merck, Judy Lewent has pioneered the science of measuring risk and redefined the role of finance within the organization. In the process, she became one of the first women to serve as CFO of a major corporation.

Today, as Merck deals with new challenges, Lewent believes that the set of strategic principles that has guided the company's capital structure will keep it strong because those principles take into account risk and the disproportionately intangible assets of a pharmaceutical maker.

Long-term view of risks

Lewent's original insight was that risk and reward are not necessarily properly valued by traditional financial measures. In drug development, one chemical compound in 10,000 studied may result in an approved prescription drug, and the process may take a decade or more.

“Many things in business, such as new markets or novel approaches, are essentially options and would not pay off in the short run,” explains Lewent. “By combining deep knowledge of the pharmaceutical business with sophisticated financial tools, we have built and refined our Research Planning Model. Based on Monte Carlo analysis, the model gives us a robust long–term view of where the risks are, so that we can help to move the right projects forward for the right reasons.”

Over time, Lewent's responsibilities at Merck have broadened. She has helped drive external growth through her role in structuring and running joint ventures and adding value to the Asia division, created to focus on Asian markets outside of Japan.

Her line of responsibilities as president of Human Health Asia from 2003 to 2005 have given her the opportunity to get involved in the nuts and bolts of operating a business, with different responsibilities than a finance person typically has.

A great place to learn and build relationships

Lewent stocked her tool kit well at MIT Sloan. Graduating from Goucher College with an economics degree, she decided to go directly to business school in order to have the best possible opportunity in a business environment that was much less receptive to women than today's .

MIT Sloan topped her list because it was not only a leader in business education, but because of its focus on emerging technology. Lewent was determined to acquire knowledge that was cutting edge and would continue to be useful 10 or 20 years beyond business school.

As she recounts, “In my first interview on Wall Street, when I was asked about how to price options, I began to discuss Black-Scholes, only to realize that the banker was unaware of this model!”

She continues to be highly involved with MIT, calling it “one of the world's crown jewels. I believe in — and enjoy — continuous learning, and I always find ideas I can put into practice. MIT Sloan plays a unique role in business education — it's about advancing the science of management, not perpetuating the status quo. Students get to work with the very best people and explore broad areas of business. It's a very collaborative environment, a great place to learn and build relationships.”

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