Company Name: Schering-Plough Corp.
Public Availability Date: January 18, 2005

Document Sections:

INQUIRY LETTER
INQUIRY LETTER
APPENDIX 1
INQUIRY LETTER
APPENDIX 2
STAFF REPLY LETTER

December 17, 2004

By Hand

Securities and Exchange Commission
Division of Corporation Finance
Office of Chief Counsel
450 Fifth Street, N.W.
Washington, DC 20549

Re: Schering-Plough Corporation - Shareholder Proposal Submitted by Charles Miller

Ladies and Gentlemen:

On behalf of Schering-Plough Corporation, a New Jersey corporation ("Schering-Plough"), we are submitting this letter pursuant to Rule 14a-8(j) under the Securities Exchange Act of 1934 to notify the Securities and Exchange Commission (the "Commission") of Schering-Plough's intention to exclude from its proxy materials for its 2005 annual meeting of shareholders (the "Annual Meeting") a shareholder proposal (the "Proposal") submitted by Charles Miller (the "Proponent"). We also request confirmation that the staff of the Division of Corporation Finance will not recommend to the Commission that enforcement action be taken if Schering-Plough excludes the Proposal from its Annual Meeting proxy statement for the reasons set forth below.

Schering-Plough intends to file its definitive proxy materials for the Annual Meeting on March 14, 2005. In accordance with Rule 14a-8(j), six copies of this letter and its exhibits are enclosed, and one copy of this letter and its exhibits has been sent to the Proponent.

The Proposal

The Proposal requests that Schering-Plough's directors take the necessary steps, in the most expeditious manner possible, to adopt and implement a bylaw requiring each director to be elected annually. A copy of the Proposal, including the supporting statement and related correspondence, is attached to this letter as Exhibit A.

Discussion

Rule 14a-8 generally requires public companies to include in their proxy materials proposals submitted by eligible shareholders. A proposal is outside the scope of the rule, however, and therefore need not be included in the company's proxy materials, if the proposal falls within one of 13 substantive bases for exclusion specified in Rule 14a-8(i). For the reasons discussed below, we believe that the Proposal is excludable under Rule 14a-8(i)(1) on the ground that the Proposal is not a proper subject for shareholder action under the laws of Schering-Plough's state of incorporation; Rule 14a-8(i)(2) on the ground that, if implemented, the Proposal would cause Schering-Plough to violate state law; Rule 14a-8(i)(3), on the ground that the Proposal is vague and indefinite, false and misleading, inflammatory, impugns character and integrity without foundation and sets forth numerous other statements and assertions that lack factual support under Rule 14a-9, and violates Rule 14a-8(1); Rule 14a-8(i)(6) on the ground that Schering-Plough is without power or authority to implement the Proposal; and Rule 14a-8(i)(8) on the ground that the Proposal deals with an election for membership on Schering-Plough's board of directors.

I. The Proposal is Not a Proper Subject for Shareholder Action and, if Implemented, Would Cause Schering-Plough to Violate State Law

Rule 14a-8(i)(1) allows a company to exclude a proposal if the subject matter of the proposal is not a proper subject for action by shareholders under the laws of the jurisdiction of the company's organization. Similarly, Rule 14a-8(i)(2) allows a company to exclude a proposal if implementation of the proposal would cause the company to violate any state, federal or foreign law to which the company is subject. Schering-Plough is incorporated under the laws of the State of New Jersey. For the reasons set forth below, we believe that the Proposal is not a proper subject for shareholder action under New Jersey law and that implementation of the Proposal would cause Schering Plough to violate New Jersey law.1 These conclusions and the discussion of New Jersey law below are supported by the legal opinion of Pitney Hardin LLP, a nationally known New Jersey law firm experienced in matters of New Jersey corporate law, a copy of which is attached to this letter as Exhibit B.

The Proposal seeks an amendment to Schering-Plough's by-laws to require that each director be elected annually. By seeking to have the directors of Schering-Plough declassify the board of directors through a by-law amendment, the Proposal violates the New Jersey Business Corporation Act (the "NJBCA").

The authority for a New Jersey corporation to classify its board of directors is established by Section 14A:6-4(1) of the NJBCA, which provides that "[a] corporation may provide in its certificate of incorporation for the classification of its directors in respect to the time for which they shall severally hold office...." (emphasis added). Consistent with Section 14A:6-4(1), Article Ninth (a) of Schering-Plough's restated certificate of incorporation provides that the board of directors shall be staggered. As discussed in the enclosed legal opinion of Pitney Hardin LLP, this provision of Schering-Plough's certificate of incorporation can be modified or eliminated only through an amendment to the certificate of incorporation, and may not be modified or eliminated by by-law amendment.

The procedures for amending the certificate of incorporation of a New Jersey corporation are set forth in Section 14A:9-2 of the NJBCA, which generally would require that the amendment first be approved by the corporation's board of directors and then by a majority of the votes cast by the holders of the corporation's shares entitled to vote thereon. Section 14A:9-2 also provides, however, that a corporation may provide for a different shareholder approval threshold in its certificate of incorporation, and Article Ninth (e) of Schering-Plough's certificate of incorporation provides that Article Ninth may be amended only upon "the affirmative vote of the holders of at least 80% of the voting power of all of the shares of the Corporation entitled to vote generally in the election of directors...." As discussed in the legal opinion of Pitney Hardin LLP attached as Exhibit B, declassifying Schering-Plough's board of directors would require compliance with these board and shareholder approval requirements, and can not lawfully be achieved by amending Schering-Plough's by-laws as the Proposal requests. Accordingly, attempting to declassify Schering-Plough's board of directors through a by-law amendment, as the Proposal calls for, would violate Sections 14A:6-4(1) and 14A:9-2 of the NJBCA, which establish the exclusive mechanisms for adopting - and amending - a corporation's classified board.

II. The Proposal Relates to an Election for Membership on Schering-Plough's Board of Directors

Rule 14a-8(i)(8) provides that a proposal may be excluded from a company's proxy materials if "the proposal relates to an election for membership on the company's board of directors...." The staff has taken the position that a proposal that would have the effect of disqualifying previously elected directors from completing their terms may be omitted under Rule 14a-8(i)(8) unless the proponent revises the proposal to give it prospective effect only. See, e.g., Peabody Energy Corp. (February 19, 2004); PG&E Corp. (February 11, 2004); Boeing Company (February 26, 2003); Conseco Inc. (April 5, 2002).

The Proposal requests that declassification of Schering-Plough's board of directors by by-law amendment be implemented "in the most expeditious manner possible," and expresses the hope that the Proposal "can be implemented promptly with each director elected to a one-year term starting in 2006." It would be legally impossible, by by-law amendment or even by amendment of Schering-Plough's certificate of incorporation, to require that each director be elected annually beginning in 2006. Article Ninth (a) of the Company's certificate of incorporation provides that each director shall be elected to a three-year term. Accordingly, the terms of directors elected at Schering-Plough's 2004 annual meeting of shareholders will not expire until 2007. As written, the Proposal seeks to disqualify these directors, as well as the directors who are elected at the 2005 Annual Meeting, from completing their terms. Accordingly, the Proposal may be omitted under Rule 14a-8(i)(8), unless the Proponent agrees to revise it appropriately.

III. The Proposal is Vague and Indefinite, Materially False and Misleading, Inflammatory, and Impugns Character and Integrity without Foundation

A shareholder proposal may be omitted from a company's proxy materials under Rule 14a-8(i)(3) if the Proposal is contrary to any of the Commission's proxy rules, including Rule 14a-9, which prohibits materially false or misleading statements in proxy materials. We are mindful that the staff recently provided guidance in Staff Legal Bulletin No. 14B (September 15, 2004) ("SLB No. 14B") regarding the types of statements the staff will consider to be false and misleading for purposes of Rule 14a-8(i)(3). We have reviewed the Proposal and the supporting statement with that guidance in mind and believe that the following statements, listed in the order that they appear in the Proposal, render the Proposal excludable (or subject to revision) under Rule 14a-8(i)(3).

(1) "Thirty-five (35) shareholder proposals on this topic achieved an impressive 70% average supporting vote in 2004. The Council of Institutional Investors www.cii.org. whose members have $2 trillion invested, recommends adoption of this proposal topic."

The first sentence above is misleading because it is not clear whether the Proponent is suggesting that similar proposals were considered at 35 companies last year, and achieved an average approval vote of 70%, or instead is selectively highlighting 35 companies at which similar proposals were approved, without taking into account companies at which similar proposals were voted down. The absence of any identification of the 35 companies or any citation to authority for his claim makes it impossible to address the accuracy of the statement. In addition, the statement is inherently false and misleading because it does not explain what "70% average supporting vote" means. This "average" vote could mean the number of yes votes out of all votes cast, all shares outstanding, all shares voting yes or no (without regard for abstentions), or something else. Without greater specificity, Schering-Plough can not "demonstrate objectively" that the statement is false as required by SLB No. 14B. Nor can Schering-Plough determine, or demonstrate objectively, that the proposals referred to as having received an average supporting vote of 70% were in fact the same "topic" as the Proposal. In similar circumstances, the staff has permitted companies to omit the false and misleading statements unless the proponent revised them. See, e.g., Minnesota Mining and Manufacturing Company (March 18, 2002) (permitting omission of the statement "[s]hareholder right to vote on poison pill resolutions achieved a 57% average yes-vote from shareholders at 26 major companies in 2000" unless the proponent could "specifically identify the major companies referenced and provided factual support in the form of a citation to a specific source" for the voting results referenced); El Paso Corporation (March 11, 2002) (same); The Boeing Company (March 2, 2002) (permitting omission of the statement "[t]his topic won a 57% average yes-no vote ratio from shareholders at 26 major companies in 2000" unless the proponent could "specifically identify the major companies referenced and provide factual support in the form of a citation to a specific source" for the voting results referenced).

The Proponent's inclusion of the URL "www.cii.org" is also false and misleading. The staff has noted that "a website address could be subject to exclusion if it refers readers to information that may be materially false or misleading, irrelevant to the subject matter of the proposal or otherwise in contravention of the proxy rules." See Staff Legal Bulletin No. 14 (July 13, 2001). References to addresses can be inherently misleading, given that a website (particularly a third-party website, such as the one cited in the Proposal) cannot be regulated for content and is always subject to change without notice. In this instance, entering the URL brings up the "Welcome" page of a website about the Council. While the Council maintains other pages (some of which may be accessed through the Council's "Welcome" page) that may contain information that is potentially relevant to the Proposal, the "Welcome" page does not. In similar circumstances, the staff has required the website address to be deleted or revised. See, e.g., Honeywell International Inc. (January 15, 2003) (allowing omission of website address "www.cii.org" unless the proponent provided a citation to a more specific source); AMR Corporation (April 3, 2002) (same); Raytheon Company (March 12, 2002) (same).

(2) "Annual election of each director would also enable shareholders to vote annually on each member of our audit committee. This is particularly important because poor auditing had a key role in the $200 billion-plus combined market-value loss at Enron, Tyco, WorldCom, Qwest and Global Crossing."

These statements are false and misleading for two reasons. The first sentence is false and misleading because it suggests that approval of the Proposal will enable shareholders to select the members of Schering-Plough's audit committee, when in fact, under Section 14A:6-9(1) of the NJBCA, the members of the audit committee are selected by Schering-Plough's board of directors. Second, the statements taken as a whole are false and misleading because they impugn the character and integrity of the members of Schering-Plough's audit committee, without factual foundation. The statements are designed to cause shareholders to believe that the unethical or criminal conduct that occurred at Enron, Tyco and other scandal-plagued companies could occur at Schering-Plough because of the current composition of Schering-Plough's audit committee. The Proponent has no factual basis for making these statements, and their inclusion in the supporting statement is inflammatory and impugns the character and integrity of the members of the audit committee in violation of Rule 14a-9. See, e.g., Honeywell International, Inc. (January 3, 2003) (requiring deletion of certain inflammatory statements relating to the company's officers); Electronic Data Systems Corporation (March 11, 1999) (requiring deletion of certain inflammatory statement relating to the company's board of directors).

(3) "Our board was protected by an active poison pill - accountability concern. An awesome 80% shareholder vote was required to make certain key changes - entrenchment concern. We had no Lead Director or Independent Chairman. 2003 CEO pay was reported as $10 million including stock option grants. Source: ExecutivePayWatchDatabase,http://www.aflcio.org/corporateamerica/paywatch/c eon/database.cfm."

These statements are false and misleading for at least three reasons. First, the Proponent has cited a URL as the "source" of the accusatory statements that precede it, but in fact the URL leads to a website page that has nothing to do with, and provides no support for, those statements. As a result, there is no way for Schering-Plough or anyone else to verify the statements by linking to the website address. Moreover, in attempting to independently demonstrate the falseness of the statements as required by SLB 14B, we were not able to find support for such statements (other than the statements related to "CEO pay") when we searched the Executive PayWatch Database.

Second, the statement related to "2003 CEO pay" is completely irrelevant to the Proposal. The Proposal does not address executive compensation, but instead seeks to eliminate Schering-Plough's classified board. The amount of the chief executive officer's compensation may be a matter that the Proponent wishes to complain about, but he should not be permitted to do so in Schering-Plough's proxy statement, in connection with a Proposal that has nothing to do with executive compensation.

Third, all of the statements are inflammatory and impugn the character and integrity of the Schering-Plough board of directors because they imply, without any factual support or foundation, that the board and management somehow have failed in their fiduciary duties to act in the best interests of Schering-Plough and its shareholders.

(4) "The record 2002 FDA fine of $500 million levied against our company still remains as a serious red flag against our board - particularly the directors with longer tenure."

This statement is false and misleading because in impugns, without factual foundation, the character and integrity of the members of Schering-Plough's board of directors. See, e.g., Honeywell International Inc. (October 26, 2001) and Electronic Data Systems Corporation (March 11, 1999), cited above. While it is true that Schering-Plough was fined by the Food and Drug Administration, the statement that the fine "remains a serious red flag against our board" is inflammatory because it suggests that the board of directors was directly responsible for the conduct that led to the fine. In fact, no member of Schering-Plough's board of directors was the subject of an FDA proceeding or was otherwise found to be responsible for any violation of FDA rules. Moreover, some of the conduct that gave rise to the FDA proceeding occurred before two of Schering-Plough's current directors (Fred Hassan and Dr. Philip Leder) were elected to the board.

(5) "Shareholder proposal text to address some of these topics can be found on the internet and similar text can be used to submit a ballot proposal to our company for the next annual meeting."

This statement is misleading because it is vague, irrelevant and indefinite. First, it is not clear whether the statement was inadvertently included as part of a "cut and paste" from correspondence from a third party (perhaps John Chevedden, whom the Proponent has designated as his proxy in connection with the Proposal) who provided instructions on how to submit the Proposal, or instead is intended to encourage other shareholders to submit proposals relating to "some of these topics" for consideration at Schering-Plough's 2006 annual meeting. If the former, the statement is irrelevant and confusing; if the former, one is left to wonder what the Proponent means when he refers to "some of these topics," when the Proposal relates to only one topic. Whatever the purpose of the statement is, it certainly has no relevance to or provides any support for the Proposal. The staff has previously concluded that irrelevant information contained in a supporting statement may be deemed misleading and omitted under Rule 14a-8(i)(3). See, e.g., Freeport-McMoRan Copper & Gold Inc. (February 22, 1999) (permitting deletion from a supporting statement of "shareholder topics" unrelated to the classified board proposal); Knight-Ridder, Inc. (December 28, 1995) (permitting deletion of three paragraphs from a supporting statement that "may be confusing and misleading to shareholders because they are unrelated to the subject matter of the proposal").

(6) "In my view it's best for the investor if the entire board is elected once a year. Without annual election of each director shareholders have far less control over who represents them."

This statement and its source have been the topic of previous no-action letters questioning the sufficiency of the source. Although the Proponent has cited as authority for the statement Arthur Levitt's book, "Take on the Street," the book is 384 pages long, and the Proponent has not provided a page number. Without a specific citation, it would be very difficult for shareholders to find the quoted statement in the book in order to verify its accuracy. In our view, it is a waste of corporate resources to review a 384 page book to verify the accuracy of one sentence when the Proponent can easily provide a citation. The Proponent should omit the statement, or at least provide a direct quote and specific page number, as the staff has required in the past. See, e.g., The Home Depot (February 25, 2004).

We believe that the Proposal is so riddled with false, misleading, and irrelevant statements that the Proposal may be omitted in its entirety pursuant to Rule 14a-8(i)(3). The staff has indicated that, "when a proposal and supporting statement will require detailed and extensive editing in order to bring them into compliance with the proxy rules," the staff may find it appropriate to permit exclusion without providing the proponent a chance to make revisions to the proposal and supporting statement. Staff Legal Bulletin No. 14 (July 13, 2001). See also The Swiss Helvetia Fund, Inc. (April 3, 2001) and General Magic, Inc. (May 1, 2000).

IV. Implementation of the Proposal Would Require Schering-Plough to Amend its Certificate of Incorporation, and Therefore the Proposal is Beyond Schering-Plough's Power to Implement

Rule 14a-8(i)(6) allows exclusion of a proposal if the company lacks the power or authority to implement it. As discussed in Section I above, if Schering-Plough were to amend its by-laws in the manner described in the Proposal, the amended provision would be invalid under New Jersey law. Schering-Plough is therefore without power or authority to implement the Proposal.

The Proponent's apparent objective could be achieved only through amendment of Schering-Plough's certificate of incorporation. As noted in Section I above, amending the certificate of incorporation would require the approval of both the board of directors and Schering-Plough's shareholders. Because Schering-Plough has no control over whether shareholders would approve such an amendment, Schering-Plough is without power or authority to achieve the Proponent's apparent objective even through a charter amendment. See PG&E Corporation (January 22, 2001) (proposed bylaw amendment requiring that directors on key committees meet certain criteria was beyond company's power to implement because company could not control who shareholders elected).

V. The Proposal Requires Schering-Plough to Identify the Proponent in the Proxy Statement and Therefore Violates Rule 14a-8(l)

The text of the Proposal includes the name and address of the Proponent. The Proponent's inclusion of his name and address in the Proposal is an attempt to circumvent Rule 14a-8(l), which accords to the company, not the proponent, the discretion whether to include the proponent's name and address in the proxy statement or, instead, to undertake in the proxy statement to provide that information upon request. The Proponent's inclusion of his name and address in the Proposal violates Rule 14a-8(l), and therefore the Proposal is excludable under Rule 14a-8(i)(3). At a minimum, if the Proposal is required to be included in Schering-Plough's proxy statement, we request the staff's concurrence that Schering-Plough may delete the Proponent's name and address from the Proposal. See Citizens Holding Company (January 22, 2001); Keystone Financial Inc. (March 16, 1999); Staff Legal Bulletin No 14, D (July 13, 2001).

Conclusion

Based on the foregoing, we request your concurrence that the Proposal may be omitted from Schering-Plough's Annual Meeting proxy materials. If you would like to discuss the Proposal or any of the matters discussed in this letter, please feel free to call me at (202) 637-5737.

Sincerely,

/s/

Alan L. Dye
2027836 v7

Enclosures

ccs: Susan Ellen Wolf
Charles Miller

-----FOOTNOTES-----

1 Although the Proposal is precatory in that it "requests" that Schering-Plough adopt the proposed by-law amendment, even a precatory proposal is excludable if the action called for by the proposal would violate state, federal or foreign law. See Pennzoil Corporation (March 22, 1993); Badger Paper Mills, Inc. (March 15, 2000).

[INQUIRY LETTER]

Charles Miller
23 Park Circle
Great Neck. NY 11024

Mr. Fred Hassan
Schering-Plough Corporation (SGP)
2000 Galloping Hill Rd
Kenilworth NJ 07033

Dear Mr. Hassan,

This Rule 14a-8 proposal is respectfully submitted to advance the long-term performance of our company. This proposal is submitted for the next annual shareholder meeting Rule 14a-8 requirements are intended to be met including the continuous ownership of the required stock value until after the date of the applicable shareholder meeting. This submitted format, with the shareholder-supplied emphasis, is intended to be used for definitive proxy publication. This is the proxy for Mr. John Chevedden and/or his designee to act on my behalf in shareholder matters, including this Rule 14a-8 proposal for the forthcoming shareholder meeting before, during and after the forthcoming shareholder meeting. Please direct all future communication to Mr. Chevedden at:

2215 Nelson Ave., No. 205
Redondo Beach, CA 90278
PH: 310-371-7872

Your consideration and the consideration of the Board of Directors is appreciated.

Sincerely,

/s/

Oct. 15, 2004

cc: Joseph J. Larosa, Corporate Secretary
PH: 908 298-4000
FX: 908 298-7082

3-Elect Each Director Annually

RESOLVED: Shareholders request that our Directors take the necessary steps, in the most expeditions manner possible, to adopt and implement a bylaw requiring each director to be elected annually.

I hope that this proposal can be implemented promptly with each director elected to a one-year term starting in 2006. This would be similar to the Safeway Inc. 2004 definitive proxy example.

Charles Miller, 23 Park Circle, Great Neck, NY 11024 submitted this proposal.

Strong Investor Concern

Thirty-five (35) shareholder proposals on this topic achieved an impressive 70% average supporting vote in 2004. The Council of Institutional Investors www.cii.org. whose members have $2 million invested, recommends adoption of this proposal topic.

Annual election of each director would also enable shareholders to vote annually on each member of our key Audit Committee. This is particularly important because poor auditing had a key role in the $200 billion-plus combined market-value loss at Enron, Tyco, WorldCom. Qwest and Global Crossing.

Progress Begins with a First Step

I believe that the need to take the above RESOLVED step is reinforced by viewing our overall corporate governance flmess which is not impeccable. For instance in 2004 it was reported:

Our board was protected by an active poison pill - accountability concern.

An awesome 80% shareholder vote was required to make certain key changes - entrenchment concern.

We had no Lead Director or Independent Chairman.

2003 CEO pay was reported as $10 million including stock option grants.

Source: Executive PayWatch Database,
http://www.aflcio.org/corporateamerica/paywatch/ccon/database.cfm

The record 2002 FDA fine of $500 million levled against our company still remains as a serious red flag against our board - particularly the directors with longer tenure.

Shareholder proposal text to address some of these topics can be found on the internet and similar text can be used to submit a ballot proposal to our company for the next annual meeting.

Best for the Investor

Arthur Levitt, Chairman of the Securities and Exchange Commission, 1993-2001 said: In my view it's best for the investor if the entire board is elected once a year. Without annual election of each director shareholders have far less control over who represents them.

"Take on the Street" by Arthur Levitt

Elect Each Director Annually Yes on 3

Notes:

The above format is the format submitted and intended for publication.

Please note that the title of the proposal is part of the argument in favor of the proposal. In the interest of clarity and to avoid confusion the title of this and each other ballot item is requested to be consistent throughout the proxy materials.

This proposal is believed to conform with Staff Legal Bulletin No. 14B (CF), September 15, 2004.

Please advise if there is any typographical question.

Verification of stock ownership will be forwarded.

January 7, 2005

6 Copies

7th Copy for Date-Stamp Return

Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549

Schering-Plough Corporation (SGP)
Shareholder Position on Company No-Action Request
Rule 14a-8 Proposal: Annual Election of Each Director
Proponent: Charles Miller

Ladies and Gentlemen:

The company argument is incomplete by failing to address the company's power to set in motion and to complete the amendment of its certificate of incorporation to accommodate annual election of each director. There is no argument in the company no action request challenging that amending its certificate of incorporation and bylaws can proceed as parallel activities.

The company does not address its power to amend its certificate of incorporation and the great persuasive power the company has by recommending shareholders approve a company ballot item. The topic of this proposal, annual election of each director, receives high levels of support from shareholders. For instance this topic won 89% of the yes and no votes at the Electronic Data Systems (EDS) 2004 annual meeting.

This Rule 14a-8 proposal does not require that any directors not complete their terms - unless it is permissible. The text of the proposal cites the "Safeway Inc. 2004 definitive proxy example" where it was permissible for directors to stand for election before completing their terms. The company conveniently leaves out the first part of its own quote from the rule 14a-8 proposal text (emphasis added), "I hope that this proposal can be implemented promptly with each director elected to a one-year term starting in 2006." This type of sneaky omission may damage the company's total credibility in its no action letter.

The company raises a number of accuracy issues which seem to be outdated by SLB No. 14B.

For the above reasons it is respectfully requested that concurrence not be granted to the company.

Sincerely,

/s/

John Chevedden

cc: Charles Miller
Susan Wolf, Corporate Secretary

3 - Elect Each Director Annually

RESOLVED: Shareholders request that our Directors take the necessary steps, in the most expeditious manner possible, to adopt and implement a bylaw requiring each director to be elected annually.

I hope that this proposal can be implemented promptly with each director elected to a one-year term starting in 2006. This would be similar to the Safeway Inc. 2004 definitive proxy example.

Charles Miller, 23 Park Circle, Great Neck, NY 11024 submitted this proposal.

Strong Investor Concern

Thirty-five (35) shareholder proposals on this topic achieved an impressive 70% average supporting vote in 2004. The Council of Institutional Investors www.cii.org. whose members have $2 trillion invested, recommends adoption of this proposal topic.

Annual election of each director would also enable shareholders to vote annually on each member of our key Audit Committee. This is particularly important because poor auditing had a key role in the $200 billion-plus combined market-value loss at Enron, Tyco, WorldCom, Qwest and Global Crossing.

Progress Begins with a First Step

I believe that the need to take the above RESOLVED step is reinforced by viewing our overall corporate governance fitness which is not impeccable. For instance in 2004 it was reported:

Our board was protected by an active poison pill - accountability concern.

An awesome 80% shareholder vote was required to make certain key changes - entrenchment concern.

We had no Lead Director or Independent Chairman.

2003 CEO pay was reported as $10 million including stock option grants.

Source: Executive PayWatch Database, http://www.aflcio.org/corporateamerica/paywatch/ceou/database.cfm

The record 2002 FDA fine of $500 million levied against our company still remains as a serious red flag against our board - particularly the directors with longer tenure.

Shareholder proposal text to address some of these topics can be found on the internet and similar text can be used to submit a ballot proposal to our company for the next annual meeting.

Best for the Investor

Arthur Levitt, Chairman of the Securities and Exchange Commission, 1993-2001 said: In my view it's best for the investor if the entire board is elected once a year. Without annual election of each director shareholders have far less control over who represents them.

"Take on the Street" by Arthur Levitt

Elect Each Director Annually Yes on 3

Notes:

The above format is the format submitted and intended for publication.

Please note that the title of the proposal is part of the argument in favor of the proposal. In the interest of clarity and to avoid confusion the title of this and each other ballot item is requested to be consistent throughout the proxy materials.

This proposal is believed to conform with Staff Legal Bulletin No. 14B (CF), September 15, 2004.

Please advise if there is any typographical question.

Verification of stock ownership will be forwarded.

January 18, 2005

Response of the Office of Chief Counsel
Division of Corporation Finance

Re: Schering-Plough Corporation
Incoming letter dated December 17, 2004

The proposal requests that the board take the necessary steps, in the most expeditious manner possible, to adopt and implement a bylaw requiring the annual election of directors.

We are unable to concur in your view that Schering-Plough may exclude the proposal under rule 14a-8(i)(1). Accordingly, we do not believe that Schering-Plough may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(1).

We are unable to concur in your view that Schering-Plough may exclude the proposal under rule 14a-8(i)(2). Accordingly, we do not believe that Schering-Plough may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(2).

We are unable to concur in your view that Schering-Plough may exclude the proposal under rule 14a-8(i)(3). Accordingly, we do not believe that Schering-Plough may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(3).

We are unable to concur in your view that Schering-Plough may exclude the proposal under rule 14a-8(i)(6). Accordingly, we do not believe that Schering-Plough may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(6).

We are unable to concur in your view that Schering-Plough may exclude the proposal under rule 14a-8(i)(8). Accordingly, we do not believe that Schering-Plough may omit the proposal from its proxy materials in reliance on rule 14a-8(i)(8).

There seems to be some basis for your view that Schering-Plough may exclude the sentence that begins "Charles..." and ends "... this proposal" under rule 14a-8(l). Accordingly, it is our view that Schering-Plough may omit this sentence from the proposal under rule 14a-8(l).

Sincerely,

/s/

Sara D. Kalin
Attorney-Advisor