Merck & Co. (MRK) 10-K 2010 FY Annual report

Exhibit 12

MERCK & CO., INC. AND SUBSIDIARIES

Computation of Ratios of Earnings to Fixed Charges

($ in millions except ratio data)

	Years Ended December 31,
	2010			2009			2008			2007			2006
Income Before Taxes	$	1,653		$	15,290		$	9,931		$	3,492		$	6,342
Add (Subtract):
One-third of rents		144			79			75			66			68
Interest expense, gross		715			460			251			384			375
Interest capitalized, net of amortization		3			27			42			32			29
Equity (income) loss from affiliates, net of distributions		(263	)		(511	)		(494	)		(454	)		(363	)
Earnings as defined	$	2,252		$	15,345		$	9,805		$	3,520		$	6,451
One-third of rents	$	144		$	79		$	75		$	66		$	68
Interest expense, gross		715			460			251			384			375
Preferred stock dividends		202			143			145			158			166
Fixed Charges	$	1,061		$	682		$	471		$	608		$	609
Ratio of Earnings to Fixed Charges		2			23			21			6			11

For purposes of computing these ratios, “earnings” consist of income before taxes, one-third of rents (deemed by the Company to be representative of the interest factor inherent in rents), interest expense, interest capitalized, net of amortization and equity (income) loss from affiliates, net of distributions. “Fixed charges” consist of one-third of rents, interest expense as reported in the consolidated financial statements and dividends on preferred stock. Interest expense does not include interest related to uncertain tax positions.