The case of who bought whom in the Merck (NYSE: MRK)-Schering-Plough deal has ended in a draw.

In order to avoid triggering a change-in-ownership provision in a contract between Johnson & Johnson (NYSE: JNJ) and Schering-Plough, Merck set up its acquisition of Schering-Plough so that Schering-Plough technically bought Merck in a reverse merger and then changed its name to Merck. Johnson & Johnson cried foul and took the entity formerly known as Schering-Plough to arbitration, claiming full rights to anti-inflammatory Remicade and its follow up Simponi that Schering-Plough marketed for Johnson & Johnson outside the U.S.

Rather than let an arbiter make the final decision, the two sides decided to hash out a compromise. Under the terms of the new agreement, Merck retains territories that make up about 70% of the current revenue it gets from selling the two drugs. In those regions Merck also has to pay Johnson & Johnson more of the profit than it had been, bumping the Johnson & Johnson's share from 42% up to 50%. Additionally Merck has to make a one-time payment of $500 million for the privilege of giving up part of its rights.

It's tempting to declare Johnson & Johnson the winner here -- it does, after all, have more than it did before. But Merck could have lost the entire $2.8 billion in revenue it brings in from the drugs with one pound of the gavel. A settlement lifts the clouds that have been hanging over Merck's shares for over a year. Considering both companies are up today, I think it's fair to call this one a draw.

With the uncertainty gone, the companies can get back to marketing Remicade and Simponi in their three way battle with Abbott Labs' (NYSE: ABT) Humira and Enbrel from Pfizer (NYSE: PFE) and Amgen (Nasdaq: AMGN), while preparing for the upcoming onslaught from oral medications being developed by Pfizer, Rigel Pharmaceuticals (Nasdaq: RIGL), and others.

Uncertain about where the market is going? Watch this before the market crashes.

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