Noble and wise Fool Stephen D. Simpson has waxed disturbed about the riskiness of investing in pharmaceutical giant and Motley Fool Income Investor pick Merck (NYSE:MRK).

It's true that things haven't been going Merck's way. In addition to its Vioxx troubles, the company is losing patent protection 10 years early (in 2008) for osteoporosis drug Fosamax. Not only that, but investors have been worried about a possible bankruptcy or costly merger.

But this Fool thinks the company is more stable than it presently appears. If I am right, then Merck could be "on sale" right now for income and long-term investors.

Chairman and Chief Executive Raymond Gilmartin denies the rumors of impending bankruptcy or merger. And he shuns the notion that Merck is on shaky legs in the first place. Gilmartin contends Merck's cash flow, balance sheet, and experienced management team are proof of the company's strength -- and he has laid out Merck's near-term strategies for continued success and shareholder profitability.

The company has plans for entering into more partnerships and alliances like the lucrative ones it enjoys with Schering-Plough (NYSE:SGP) and Bristol-Myers (NYSE:BMY). Two of Merck's reliable best-sellers, Zetia and Vytorin, were developed in conjunction with Schering-Plough. Working with Bristol-Meyers, Merck has developed a new Type 2 diabetes drug, Muraglitazar, for which it's seeking FDA approval.

International alliances have aided Merck in developing an insomnia drug that could receive approval in 2007, and it's working on a drug to treat acute stroke victims.

Add to all this the fact that GlaxoSmithKline (NYSE:GSK) and MedImmune (NASDAQ:MEDI) have included Merck in a licensing and royalty deal on a phase 3-development cervical cancer vaccine, and you find a giant company with a large product pipeline refusing to say "die."

"To us, this is the best way to build shareholder value," says Gilmartin:

He should know. He steers one of the world's flagship pharmaceutical companies. In my opinion, Fools would be wise not to follow the crowd in taking on what I'd call an excessively negative attitude toward the company in the wake of some dark news.

Brant David McLaughlin is very thankful that he's in tip-top health after reading about all Merck's different medications. At present he does not own any shares of any of the companies mentioned in this story.