<PAGE>

                                                                    Exhibit 10.8
                                                                    ------------

         TAX RESPONSIBILITY ALLOCATION AGREEMENT (the "Agreement"), dated as of
_____ between Merck & Co., Inc., a New Jersey Corporation ("Distributing"), and
MedcoHealth Solutions, Inc., a Delaware corporation ("Controlled" and together
with Distributing, the "Companies").

         WHEREAS, Distributing owned 100% of the membership interests in Merck
Medco Care LLC, a Delaware limited liability company ("Medco") and, as part of a
plan intended to culminate in the Distribution (as defined below), has caused
Medco to convert under Delaware law to a corporation which has adopted the name
of Controlled;

         WHEREAS, pursuant to such plan and as part of a series of transactions
resulting in a public offering of not more than 19.9% of Controlled's shares,
Distributing will exchange not more than 19.9% of its stock in Controlled for
outstanding Distributing commercial paper (the "Exchange") on the date of the
Exchange (the "Exchange Date");

         WHEREAS, pursuant to such plan, the board of directors of Distributing
has determined it would be in the best interests of Distributing and its
shareholders to distribute, after the Exchange (the "Distribution"), all of
Distributing's remaining shares in Controlled to the Distributing shareholders
on the terms and conditions set forth in the Master Separation and Distribution
Agreement dated the date hereof between Distributing and Controlled (the
"Distribution Agreement") (the date of such Distribution, the "Distribution
Date");

         WHEREAS, the Companies intend that the Distribution qualify as a
tax-free spin-off pursuant to Section 355 and as a reorganization pursuant to
Section 368(a)(1)(D) of the Internal Revenue Code of 1986, as amended (the
"Code");


                                       1

<PAGE>
         WHEREAS, as of the date hereof, Distributing is the common parent of an
affiliated group of domestic corporations, including Controlled, which has
elected to file consolidated federal income tax returns (the "Distributing
Consolidated Group") and, as a result of the Distribution, Controlled will not
be a member of the Distributing Consolidated Group for the portion of the
taxable year following the Distribution or in future taxable years;

         WHEREAS, the Companies desire (i) to allocate the responsibilities for
Income Tax (as hereinafter defined) of Controlled, (ii) to allocate the
responsibilities for Other Controlled Tax (as hereinafter defined) and (iii) to
provide for certain additional Tax (as hereinafter defined) matters;

         NOW, THEREFORE, in consideration of the mutual covenants and agreements
contained herein, the Companies (each on behalf of itself, each of its
subsidiaries as of the Distribution Date, and its future subsidiaries) hereby
agree as follows:


                                       2

<PAGE>
                                    ARTICLE I

                                   DEFINITIONS

         The following terms shall have the following meanings (such meanings to
apply equally to both the singular and the plural forms of the terms defined).
All section references are to this Agreement unless otherwise stated.

         "Affiliate" means any entity that directly or indirectly is Controlled
          ---------
by the person or entity in question.

         "Control" means the possession, directly or indirectly, of the power to
          -------
direct or cause the direction of the management and policies of a person,
whether through ownership of voting securities, by contract or otherwise.

         "Controlled Business" means any businesses formerly carried out by
          -------------------
Distributing (directly or indirectly), that are now carried out by the
Controlled Group and any assets owned directly or indirectly by Distributing
that are now owned by the Controlled Group.

         "Controlled Group" shall mean, collectively or separately, Controlled
          ----------------
and any Affiliate of Controlled for which Controlled has any direct or indirect
Tax liability.

         "Controlled Separate Federal Income Tax Liability" means, with respect
          ------------------------------------------------
to any period for which the Controlled Group is included in Distributing's
Consolidated Group, the liability for U.S. federal income tax (including
"alternative minimum tax", if any) of the Controlled Group computed as though
the Controlled Group filed a U.S. federal income tax return separate from
Distributing for such taxable period, which amount shall not be less than zero.

         "Controlled Separate State Tax Liability" means, with respect to any
          ---------------------------------------
period for which the Controlled Group is included in any of Distributing's
combined or unitary


                                       3

<PAGE>

groups, the liability for state or local Income Tax of the Controlled Group
computed as though the Controlled Group filed a Tax Return separate from
Distributing for such taxable period, which amount shall not be less than zero.

         "Distributing Group" shall mean, collectively or separately,
          ------------------
Distributing and any Affiliate of Distributing for which Distributing has any
direct or indirect Tax liability, other than any member of the Controlled Group.

         "Distributing Subsidiary" shall mean an Affiliate of Distributing other
          -----------------------
than Controlled or any Affiliate of Controlled.

         "Income Tax" means any federal, state or local tax imposed on net
          ----------
income including the Michigan Single Business Tax, but not including Washington
State's "business and occupation tax" or any municipal gross receipts tax
("patente") imposed in Puerto Rico.

         "IRS Private Letter Ruling" means any private letter ruling from the
          -------------------------
United States Internal Revenue Service issued in connection with the
Distribution.

         "Other Controlled Tax" means any Tax of the Controlled Group or with
          --------------------
respect to the Controlled Business that is not an Income Tax (whether payable
directly by Controlled Group or payable by a combined or unitary group that
includes the Controlled Group to the extent of Controlled Group's portion of
such Tax).

         "Post-Distribution Period" means all taxable periods or portions of
          ------------------------
periods beginning on or after the Distribution Date.

         "Post-Exchange Period" means all taxable periods or portions of periods
          --------------------
beginning on or after the Exchange Date and which is not a Post-Distribution
Period.


                                       4

<PAGE>

         "Pre-Exchange Period" means all taxable periods or portions of periods
          -------------------
ending before the Exchange Date.

         "Tax" means any income, gross income, gross receipts, profits, capital
          ---
stock, franchise, withholding, payroll, social security, workers compensation,
unemployment, disability, property, ad valorem, stamp, excise, severance,
occupation, service, sales, use, license, lease, transfer, import, export, value
added, alternative minimum, estimated or other similar tax (including any fee,
assessment, or other charge in the nature of or in lieu of any tax) imposed by
any governmental entity or political subdivision thereof, and any interest,
penalties, additions to tax, or additional amounts in respect of the foregoing
imposed on any taxpayer or consolidated, combined or unitary group of taxpayers.

         "Tax Authority" means, with respect to any Tax, the governmental entity
          -------------
or political subdivision thereof that imposes such Tax, and the agency (if any)
charged with the collection of such Tax for such entity or subdivision.

         "Tax Benefit" means the amount that any item of loss, deduction or
          -----------
credit (or any other item) decreases Taxes paid or payable including any
interest with respect thereto or interest that would have been payable but for
such item, net of any Tax imposed on such interest.

         "Tax Contest" means an audit, review, examination, or any other
          -----------
administrative or judicial proceeding with the purpose or effect of
redetermining any Tax (including any administrative or judicial review of any
claim for refund).

         "Tax Detriment" means the amount that any item of income or gain (or
          -------------
any other item) increases Taxes paid or payable including any interest with
respect thereto.


                                       5

<PAGE>

         "Tax Return" means any report of Tax due, any claims for refund of Tax
          ----------
paid, any information return with respect to Tax, any election made with respect
to Tax, or any other similar report, statement, declaration, or document
required to be filed under the Code or other law in respect of Tax, including
any attachments, exhibits, or other materials submitted with any of the
foregoing, and including any amendments or supplements to any of the foregoing
for any taxpayer or consolidated, combined or unitary group of taxpayers.

                                   ARTICLE II

                             RESPONSIBILITY FOR TAX

        2.01      Responsibility for Tax.
                  ----------------------

                  (a) Distributing shall be responsible for and indemnify and
hold harmless the Controlled Group from (i) any liability for Income Tax of the
Controlled Group with respect to the Pre-Exchange Period; (ii) any Income Tax of
the Distributing Group by reason of Controlled Group being severally liable for
such Income Tax pursuant to Treasury Regulations Section 1.1502-6 or any
analogous provision of state or local law; and (iii) any item described in
Section 3.01(a) to the extent not covered by Section 3.01(b).

                  (b) For all Post-Exchange Periods in which Controlled is a
member of the Distributing Consolidated Group, Controlled shall be responsible
for and shall timely pay to Distributing (at the time specified in Section
2.04), an amount equal to the Controlled Separate Federal Income Tax Liability,
as calculated by Distributing in good faith and in the normal course of
business.


                                       6

<PAGE>

                  (c) For all Post-Exchange Periods in which Controlled or any
other member of the Controlled Group is a member of a state or local
consolidated, combined or unitary group of which any member of the Distributing
Group is the parent, Controlled shall be responsible for and shall timely pay
Distributing (at the time specified in Section 2.04), an amount equal to the
Controlled Separate State Tax Liability, as calculated by Distributing in good
faith and in the normal course of business.

                  (d) Controlled shall be responsible for, and indemnify and
hold harmless the Distributing Group from (i) all Income Tax of the Controlled
Group with respect to a Post-Exchange Period not covered by 2.01(b) and (c)
above, (ii) all Income Tax of the Controlled Group with respect to a
Post-Distribution Period, (iii) all Other Controlled Tax (regardless of which
period it relates to) and (iv) any act for which Controlled is liable under
Section 3.01(b).

                  (e) Distributing shall be responsible for and shall pay
Controlled the amount of any reduction in Income Tax in a Post-Exchange Period
when and if actually realized by the Distributing Group which is attributable to
the utilization of a "net operating loss" generated by the Controlled Group
(calculated as if the Controlled Group were a separate taxpayer).

                  (f) For purposes of this Agreement, in the case of any taxable
period that begins before and ends after the date of the Exchange or begins
before and ends after the Distribution Date, the amount of all Income Tax
payable for a portion of a period shall be the amount which would have been
payable if that portion of a period constituted a separate taxable period
beginning on the date such portion of a period began and ending


                                       7

<PAGE>

on the date such portion of a period ended, or in such other manner as the
parties may agree.

         2.02     Refunds and Tax Benefits.
                  ------------------------

                  (a) Refunds and Carrybacks. (i) Except as provided in (vi)
below, Distributing shall be entitled to any refunds of Income Tax paid by or on
behalf of the Controlled Group (including refunds paid by means of a credit
against other or future Tax liabilities) arising with respect to taxable periods
ending on or before the Exchange Date.

                  (ii) Controlled shall be entitled to any refunds of Income Tax
paid by or on behalf of the Controlled Group (including refunds paid by means of
a credit against other or future Tax liabilities) arising with respect to
taxable periods beginning on or after the Exchange Date.

                  (iii) Distributing and Controlled agree to allocate refunds of
Income Tax of the Controlled Group (including refunds paid by means of a credit
against other or future Tax liabilities) arising with respect to taxable periods
that begin before and end after the Exchange Date to whichever of Distributing,
Controlled, or both initially bore the items to which such refund is
attributable.

                  (iv) Controlled shall be entitled to any refunds or credits of
Other Controlled Tax (including refunds paid by means of a credit against other
or future Tax liabilities).

                  (v) Controlled shall promptly forward to Distributing or
reimburse Distributing for any refunds due Distributing (pursuant to the terms
of this Section 2.02(a)) after receipt thereof (less any net Tax Detriment
imposed with respect to


                                       8

<PAGE>

such refunds or any interest paid with respect to such refunds), and
Distributing shall promptly forward to Controlled or reimburse Controlled for
any refunds due Controlled (pursuant to the terms of this Section 2.02(a)) after
receipt thereof (less any net Tax Detriment imposed with respect to such refunds
or any interest paid with respect to such refunds). In the case of a refund
received in the form of a credit against other or future Tax liabilities,
reimbursement in respect of such refund shall be due in each case on the due
date for payment of the Tax against which such refund has been credited. If
Distributing reasonably so requests, Controlled, at Distributing's expense,
shall file for and pursue any refund to which Distributing is entitled under
this Section 2.02(a). If Controlled reasonably so requests, Distributing, at
Controlled's expense, shall file for and pursue any refund to which Controlled
is entitled to under this Section 2.02(a).

                  (vi) Distributing agrees that if the Controlled Group carries
back any item of loss, deduction or credit which arises in any taxable period
ending after the Distribution Date into any taxable period beginning before the
Distribution Date, then Controlled shall be entitled to any Tax Benefit or
refund of Tax realized as a result of the carryback.

                  (b) Allocation of Benefits. If any adjustments shall be made
to any Tax Returns relating to Income Taxes of the Controlled Group or the
Distributing Group for the Pre-Exchange Period as a result of or in settlement
of any Tax Contest, and if such adjustment results in any Tax Detriment to
Distributing or any Affiliate of Distributing (including the Controlled Group)
with respect to such period and any Tax Benefit to the Controlled Group for any
taxable period (or portion thereof) beginning after the Exchange Date,
Controlled shall pay to Distributing the amount of such Tax Benefit at such time
or


                                       9

<PAGE>

times as and to the extent that the Controlled Group realizes such benefit
through a refund of Tax or reduction in the amount of Tax which the Controlled
Group would otherwise have had to pay if such adjustment had not been made.

                  If any adjustments shall be made to any Tax Returns relating
to Income Taxes of the Controlled Group for any Post-Exchange Period or
Post-Distribution Period as a result of or in settlement of any Tax Contest, and
if such adjustment results in any Tax Detriment to the Controlled Group with
respect to such period and any Tax Benefit to Distributing or any Affiliate of
Distributing (including the Controlled Group) for the Pre-Exchange Period,
Distributing shall pay to Controlled the amount of such Tax Benefit at such time
or times as and to the extent that Distributing or any Affiliate of Distributing
realizes such benefit through a refund of Tax or reduction in the amount of Tax
which Distributing or such Affiliate of Distributing would otherwise have had to
pay if such adjustment had not been made.

         2.03     Option Deductions.
                  -----------------

                  (a) Acquired Company Options.

                  (i) Upon the exercise of any Acquired Company Option (as
defined in (d) below) following the Distribution, (1) Controlled shall claim any
Tax deduction attributable to such exercise on its Tax Return and Distributing
shall not claim such deduction on its Tax Return as originally filed, (2)
Controlled shall pay to Distributing an amount equal to the Option Tax Value (as
defined in (d) below), and (3) to the extent that such deduction is disallowed
to Controlled, and a Tax Authority determines (a "Determination") that
Distributing is entitled to such deduction to any extent, Distributing shall, to
such extent, repay to Controlled the portion of the Option


                                       10

<PAGE>

Tax Value attributable to such Acquired Company Option.

                  (ii) Controlled shall pay to Distributing the Option Tax Value
under this Section 2.03(a) within 30 days of the date that Distributing notifies
Controlled of the amount thereof. Distributing shall pay to Controlled the
Option Tax Value under this Section 2.03(a) within 30 days of the date that
Controlled notifies Distributing of the receipt of a Determination (which
notification shall be made promptly after receipt thereof).

                  (b) Merck Options. Upon the exercise of any Merck Option (as
defined in (d) below) following the Distribution, (i) Distributing shall claim
any Tax deduction attributable to such exercise on its Tax Return and Controlled
shall not claim such deduction on its Tax Return as originally filed, and (ii)
to the extent such deduction is disallowed to Distributing, and a Tax Authority
makes a Determination that Controlled is entitled to such deduction, Controlled
shall, to such extent, pay to Distributing, within 30 days of the date that
Distributing notifies Controlled of the receipt of such Determination (which
notification shall be made promptly after receipt thereof), the Option Tax Value
attributable to such Merck Option.

                  (c) All Other Stock Options. (i) Except as set forth in
Section 2.03(a) and 2.03(b), upon the exercise of any option to purchase
Distributing stock (whether before or following the Distribution), Distributing
shall claim any tax deduction attributable to such exercise on its Tax Return
and Controlled shall not claim such deduction on its Tax Return, and (ii) upon
the exercise of any option to purchase Controlled stock following the
Distribution, Controlled shall claim any tax deduction attributable to such
exercise on its Tax Return and Distributing shall not claim such deduction on
its Tax Return.

                  (d) Definitions. For purposes of this Section 2.03, the
following terms


                                       11

<PAGE>

shall have the following meanings:

                  (i) An "Acquired Company Option" shall mean any option to
                          -----------------------
purchase Distributing stock held by a Controlled Employee (as defined below)
granted under (1) the Medco Containment Services, Inc. 1991 Class C
Non-Qualified Stock Option Plan (as amended effective November 18, 1993), (2)
the Systemed, Inc. 1993 Employee Stock Option Plan, (3) the ProVantage Health
Services, Inc. 1999 Stock Incentive Plan, (4) the Medical Marketing Group, Inc.
1991 Class B Stock Option Plan and (5) the Medical Marketing Group, Inc. 1991
Special Non-Qualified Stock Option Plan.

                  (ii) The "Controlled Employees" shall mean any and all
                            --------------------
employees of the "Medco Group" (as defined in the Distribution Agreement)
immediately following the Distribution.

                  (iii) A "Merck Option" shall mean any option to purchase
                           ------------
Distributing stock held by a Controlled Employee granted prior to February 26,
2002, other than the Acquired Company Options.

                  (iv) The "Option Tax Value" as to the exercise of any option
                            ----------------
shall be an amount equal to the sum of (1) the amount of the deduction which
would have been realized by Distributing thereon if Distributing had claimed
such deduction multiplied by the highest statutory federal income tax rate to
which Distributing is subject in the year of exercise (regardless of actual
liability), plus (2) the amount of the deduction which would have been realized
by Distributing thereon if Distributing had claimed such deduction multiplied by
Distributing's weighted average state statutory income tax rate in


                                       12

<PAGE>

the year of option exercise (regardless of actual liability, but less federal
benefit), plus (3) employment taxes, if any, payable by Distributing by reason
of the exercise of such option, plus (4) an additional payment such that, after
payment by Distributing of Tax, if any, upon the receipt of the Option Tax Value
(including upon the payment provided by this clause (4)), Distributing retains
an amount equal to the sum of the amounts set forth in clauses (1), (2) and (3)
of this sentence.

         2.04     Preparation of Tax Returns.
                  --------------------------

                  (a) Distributing shall cause the Controlled Group to join, for
any Post-Exchange Period for which the Controlled Group is required to do so
(and may cause the Controlled Group (or any member thereof) to join for any such
period or Tax Return for which the Controlled Group is eligible but not required
to do so), in all federal, state or local consolidated, combined or unitary
Income Tax Returns of Distributing's filing group. Distributing shall prepare
and timely file all such federal, state or local consolidated, combined or
unitary Tax Returns and shall timely pay all Tax with respect to such Tax
Returns. Distributing shall provide to Controlled a copy of the portion of each
such Tax Return and any supporting schedules that relate to the Controlled Group
within 5 days after the filing thereof. With respect to the Income Taxes payable
for the taxable year covered by such Tax Returns, Controlled shall pay to
Distributing, within 30 days following the close of such taxable year, the
current provision for such Income Taxes, as recorded on the financial statements
of Controlled. Within 30 days after the later of (i) the filing of the federal
Income Tax Return for such taxable year and (ii) the filing of the last to be
filed state Income Tax Return for such taxable year, Controlled shall pay to
Distributing, or Distributing shall pay to Controlled, as applicable, the amount
by which the Taxes paid pursuant to the previous sentence are less than (in the
case of a payment by Controlled) or more than (in the case of a payment by
Distributing) the sum of the Controlled Separate Federal Income Tax Liability
and Controlled Separate


                                       13

<PAGE>

State Tax Liability.

                  (b) Distributing shall prepare (or cause to be prepared) and
Controlled shall timely file (or cause to be timely filed) any other Tax Return
relating to Income Tax of the Controlled Group for any period that begins before
the Distribution Date (or any portion of such a Tax Return which relates to the
portion of such period ending on the Distribution Date) whether it is required
to be filed before or after the Distribution Date (other than those required to
be filed by Distributing pursuant to Section 2.04(a) above). Distributing shall
provide a copy of each such Tax Return (or portion thereof) and any supporting
schedules to Controlled at least 30 days before the date such Return is to be
filed by Controlled for Controlled's review and approval, which approval shall
not be unreasonably withheld. Controlled shall pay all Tax with respect to such
Tax Return, except that Distributing shall pay to Controlled at least 5 days
prior to the filing of such Tax Return the amount due on such Tax Return that is
the responsibility of Distributing pursuant to Section 2.01.

                  (c) The filing of Tax Returns relating to Other Controlled Tax
shall be governed by the Transition Services Agreement. Controlled shall pay all
Tax with respect to any such Tax Return.

                  (d) Controlled shall not file (or allow the Controlled Group
to file) any amended Tax Returns with respect to the Controlled Group for any
Pre-Exchange Period or Post-Exchange Period without Distributing's consent.

         2.05 Cooperation and Exchange of Information. Distributing, on the one
              ---------------------------------------
hand, and Controlled, on the other, will timely and competently provide each
other with such cooperation and information as either of them reasonably may
request of the other in (i) filing any Tax Return, amended return or claim for
refund, (ii) determining a liability for Tax or a right to a refund of Tax or
(iii) participating in or conducting any audit or other proceeding in respect of
Tax. Such cooperation and information shall include providing


                                       14

<PAGE>

copies of relevant Tax Returns or portions thereof, together with accompanying
schedules and related work papers and documents relating to rulings or other
determinations by any Tax Authorities. Each party shall devote the personnel and
resources necessary in order to carry out this Section 2.05 and shall make its
employees available on a mutually convenient basis to provide explanations of
any documents or information provided hereunder. Except as provided to the
contrary in the Transition Services Agreement, each party shall carry out their
responsibilities under this Section 2.05 without charge to the other. Any
information obtained under this Section 2.05 shall be kept confidential, except
as may be otherwise necessary in connection with the filing of Tax Returns or
claims for refund or in conducting an audit or other proceeding.

         2.06     Tax Contests.
                  ------------

                  (a) Notice. Each of the parties shall provide prompt notice to
the other party of any pending or threatened Tax audit, assessment or proceeding
or other Tax Contest of which it becomes aware related to Tax for which it is
indemnified by the other party hereunder. Such notice shall contain factual
information (to the extent known) describing any asserted Tax liability in
reasonable detail and shall be accompanied by copies of any notice and other
documents received from any Tax Authority in respect of any such matters. If an
indemnified party has knowledge of an asserted Tax liability with respect to a
matter for which it is to be indemnified hereunder and such party fails to give
the indemnifying party prompt notice of such asserted Tax liability, then (i) if
the indemnifying party is precluded from contesting the asserted Tax liability
in any forum as a result of the failure to give prompt notice, the indemnifying
party shall have no obligation to indemnify the indemnified party for any Tax
arising out of such asserted


                                       15

<PAGE>

Tax liability, and (ii) if the indemnifying party is not precluded from
contesting the asserted Tax liability in any forum, but such failure to give
prompt notice results in a monetary detriment to the indemnifying party, then
any amount which the indemnifying party is otherwise required to pay the
indemnified party pursuant to this Agreement shall be reduced by the amount of
such detriment.

                  (b) Control of Tax Contests. Each Company shall have full
responsibility and discretion in handling, settling or contesting any Tax
Contest involving a Tax for which it is liable pursuant to Section 2 of this
Agreement; provided, however, Distributing shall have full responsibility and
discretion in handling, settling or contesting any Tax Contest with respect to a
consolidated, combined or unitary federal or state Income Tax of which
Distributing or a Distributing Subsidiary is the common parent. Furthermore,
Distributing may participate in any Tax Contest with respect to Covered
Transaction Tax (as hereinafter defined), and Controlled shall consider in good
faith Distributing's advice with respect thereto, regardless of whether
Distributing has liability or indemnification obligations with respect to such
Tax under this Agreement.

                                   ARTICLE III

                                TRANSACTIONS TAX

         3.01     Transactions Tax.
                  ----------------

                  (a) General. Except as otherwise provided in this Section
3.01, Distributing shall be responsible for and pay any and all Tax resulting
from income or gain recognized by Distributing as a result of the Distribution
failing to qualify for or maintain tax-free treatment pursuant to Section 355 of
the Code or other provisions of the Code or corresponding provisions of other
applicable Tax laws and any Tax resulting


                                       16

<PAGE>

from any income or gain recognized by Distributing or its Affiliates (including
the Controlled Group) under Treasury Regulations Sections 1.1502-13 or 1.1502-19
(or any corresponding provisions of other applicable Tax laws) as a result of
the Distribution (collectively "Covered Transaction Tax").

                  (b) Inconsistent Acts and Events. Controlled shall be liable
for, and shall indemnify and hold harmless the Distributing Group from and
against any liability for, any Covered Transactions Tax (including without
limitation reasonable attorney fees and other costs incurred in connection
therewith) to the extent arising from (i) any breach by the Controlled Group of
the representations or covenants under Section 4, (ii) any Tainting Act (as
hereinafter defined) performed by the Controlled Group (whether or not Section
4.02(d) is complied with) and (iii) any Section 355(e) Event with respect to
Controlled (whether or not such event is caused by a Tainting Act). A Section
355(e) Event with respect to Controlled means any event, involving the stock of
Controlled or assets of the Controlled Group, which causes the Distribution to
be a taxable event to Distributing as the result of the application of Section
355(e) of the Code (i.e., the Distribution becomes taxable to Distributing under
Section 355(e) and but for the event the Distribution would not have been a
taxable event to Distributing under Section 355(e)).

                                   ARTICLE IV

                          REPRESENTATIONS AND COVENANTS

         4.01     Representations.
                  ---------------


                                       17

<PAGE>

                  (a) Each of Controlled and Distributing represent that, as of
the date of this Agreement, it and its Affiliates know of no fact that would
jeopardize the expected Tax treatment of the Exchange and Distribution.

                  (b) Each of Controlled and Distributing represent and warrant
that neither it nor any of its Affiliates has any plan or intent to take any
action which is inconsistent with the expected Tax treatment of the Exchange and
the Distribution.

         4.02     Covenants.
                  ---------

                  (a) Controlled covenants and agrees that it will not take any
action, and it will cause its Affiliates to refrain from taking any action,
which is inconsistent with the expected Tax treatment of the Exchange and the
Distribution (any such action, including any action referred to in clause (i)
through (iii), is referred to in this Agreement as a "Tainting Act"). Without
limiting the foregoing:

                  (i) Specified Actions. During the two year period following
the Distribution Date, Controlled will not (and it will cause its Affiliates not
to) (A) liquidate, merge or consolidate with or into any other corporation; (B)
issue any of its capital stock in one or more transactions, other than issuances
of stock to employees or directors in connection with the performance of
services for Controlled (that are not excessive by reference to the services
performed) which issuances either are (x) with respect to the exercise of
options that were granted by Controlled before the Closing Date or (y) with
respect to the exercise of options that were granted by Controlled on or after
the Closing Date which satisfy the requirements of Treasury Regulations Section
1.355-7T(f)(6) to not be treated for purposes of Section 355(e) of the Code to
be part of a plan or series of related transactions that includes the
Distribution; (C) redeem, purchase or


                                       18

<PAGE>

otherwise reacquire its capital stock in one or more transactions; (D) change
the voting rights of any of its stock; (E) sell, exchange, distribute or
otherwise dispose of, other than in the ordinary course of business, all or a
substantial part of the assets of any of the trades or businesses relied upon to
satisfy Section 355(b) of the Code; (F) issue any options to acquire Controlled
Shares other than options which satisfy the requirements of Treasury Regulations
Section 1.355-7T(g)(3)(ii); or (G) discontinue or cause to be discontinued the
active conduct of any of the trades or businesses relied upon to satisfy Section
355(b) of the Code.

                  (ii) No Inconsistent Actions. Regardless of any change in
circumstances, Controlled covenants and agrees that it will not take any action
(and it will cause its Affiliates to refrain from taking any action) which is
inconsistent with any factual statements or representations in the IRS Private
Letter Ruling on or before the second anniversary of the Distribution Date other
than as permitted in this Section 4. For this purpose an action is considered
inconsistent with a representation if the representation states that there is no
plan or intention to take such action.

                  (iii) 355(e) Covenant. Without in any manner limiting
paragraphs (i) or (ii) immediately above, Controlled covenants and agrees that,
through the second anniversary of the Distribution Date, it will not enter into
(and it will cause its Affiliates to refrain from entering into) any agreements,
understandings, arrangements or substantial negotiations with respect to
transactions or events (including stock issuances, option grants, capital
contributions, acquisitions, or changes in the voting power of any of its
stock), which may cause the Distribution to be treated as part of a plan
pursuant to


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<PAGE>

which one or more persons acquire directly or indirectly Controlled stock
representing a "50 percent or greater interest" within the meaning of Section
355(e)(4) of the Code.

                  (b) Amended or Supplemental Rulings. Each of Distributing and
Controlled covenants and agrees that it will not file, and it will cause its
Affiliates to refrain from filing, any amendment or supplement to the IRS
Private Letter Ruling with respect to the Distribution subsequent to the
Distribution Date without the consent of the other, which consent shall not be
unreasonably withheld.

                  (c) Each of Distributing and Controlled covenants and agrees
that it will not take, and it will cause its Affiliates to refrain from taking,
any position on a Tax Return that is inconsistent with the treatment of the
Distribution as tax-free pursuant to Code Section 355 and the treatment of the
Distribution in a manner inconsistent with the IRS Private Letter Ruling.

                  (d) Exceptions. Notwithstanding the foregoing, Controlled
shall be permitted to take an action inconsistent with Section 4.02(a), if,
prior to taking such action, Controlled provides notification to Distributing of
its plans with respect to such action, and promptly responds to any inquiries by
Distributing following such notification, and either:

                  (i) Controlled obtains a ruling with respect to the action
from the Internal Revenue Service or other applicable Tax Authority that is
reasonably satisfactory to Distributing (except that Controlled shall not submit
any such ruling request if Distributing determines in good faith that filing
such request might have a materially adverse effect upon Distributing), on the
basis of facts and representations consistent with the facts at the time of such
action, that such action will not affect the


                                       20

<PAGE>

expected Tax treatment of the Exchange and Distribution or the IRS Private
Letter Ruling,

                  (ii) Controlled obtains an unqualified opinion reasonably
acceptable to Distributing of an independent nationally recognized tax counsel
acceptable to Distributing, on the basis of facts and representations consistent
with the facts at the time of such action, that such action will not affect the
Tax treatment of the Distribution or the IRS Private Letter Ruling, or

                  (iii) Distributing consents in writing to such action, which
consent shall be granted or withheld in the sole and absolute discretion of
Distributing.

         Notwithstanding anything to the contrary in this Agreement, Controlled
shall be liable for, and shall indemnify and hold harmless Distributing from any
Covered Transaction Tax resulting from a Tainting Act by Controlled or its
Affiliates, regardless of whether the exception of this Section 4.02(d) is
satisfied with respect to such act.


                                       21

<PAGE>

                                    ARTICLE V

                            MISCELLANEOUS PROVISIONS

         6.01 Notice. Any payment, notice or communication required or permitted
              ------
to be given under this Agreement shall be in writing (including facsimile) and
mailed, faxed or delivered to the parties at the following addresses (or at such
other address as one party may specify by notice to the other party):

                  if to Distributing:

                           Merck & Co., Inc.
                           One Merck Drive
                           P.O. Box 100
                           Whitehouse Station, New Jersey 08889
                           Attention: Tax Director

                  if to Controlled:

                           MedcoHealth Solutions, Inc.
                           100 Parsons Pond Drive
                           Franklin Lakes, New Jersey  07417
                           Attention: Tax Director

              Notification of a change of address shall be given by either
party to the other as provided in this Section 6.01. All such notices and
communications shall be effective (i) when received, if mailed or delivered, or
(ii) when confirmed by fax answerback, if faxed.

         6.02 Governing Law. This Agreement shall be governed by the laws
              -------------
applicable to contracts entered into and to be performed within the State of New
Jersey.

         6.03 Dispute Resolution. Any and all disputes between Distributing and
              ------------------
Controlled arising out of any provision of this Agreement shall be submitted to
and


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<PAGE>

resolved by an independent nationally recognized accounting firm selected by
Distributing and Controlled.

         6.04 Jurisdiction. Each party agrees to submit itself exclusively to
              ------------
the personal jurisdiction of any New Jersey court in the event any dispute
arises out of this Agreement or any of the transactions contemplated by this
Agreement and agrees that it will not attempt to deny or defeat such personal
jurisdiction or venue by motion or other request for leave from any such New
Jersey court. Each party further agrees that service of any process, summons,
notice or document by U.S. registered mail to such party's respective address
set forth above shall be effective service of process for any action, suit or
proceeding in New Jersey with respect to any matters to which it has submitted
to jurisdiction in this Section 6.04.

         6.05 Waiver Of Jury Trial. Each party waives, to the fullest extent
              --------------------
permitted by applicable law, any right it may have to a trial by jury in respect
of any dispute arising out of this Agreement.

         6.06 Entire Agreement. This Agreement embodies the entire understanding
              ----------------
between the parties relating to its subject matter and supersedes and terminates
all prior agreements and understandings among the parties with respect to such
matters. No promises, covenants or representations of any kind, other than those
expressly stated herein, have been made to induce any party to enter into this
Agreement. This Agreement shall not be modified or terminated except by a
writing duly signed by each of the parties hereto, and no waiver of any
provisions of this Agreement shall be effective unless in a writing duly signed
by the party sought to be bound. If, and to the extent, the provisions of this
Agreement conflict with the Distribution Agreement, or any other agreement


                                       23

<PAGE>

entered into in connection with the Distribution the provisions of this
Agreement shall control.

         6.07 Assignment; Binding Effect. Neither this Agreement nor any of the
              --------------------------
rights, interests or obligations under this Agreement shall be assigned, in
whole or in part, by operation of law or otherwise by any of the parties without
the prior written consent of the other party; provided, however, that no such
consent shall be required in the event of a merger, consolidation or sale of
either Distributing or Controlled. Subject to the preceding sentence, this
Agreement shall be binding on, and shall inure to the benefit of, and be
enforceable by, the parties hereto and their respective successors and assigns.

         6.08 Counterparts. This Agreement may be executed in two or more
              ------------
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute one and the same.

         6.09 Severability. If any provision of this Agreement or the
              ------------
application of any such provision to any person or circumstances shall be held
invalid, illegal, or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality, or unenforceability shall not affect
any other provision hereof.

         6.10 Headings. Headings of sections in this Agreement are inserted for
              --------
convenience of reference only and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.

         6.11 Survival. Notwithstanding anything in this Agreement to the
              --------
contrary, the provisions of this Agreement shall survive for thirty days after
the full period of all applicable statutes of limitations (giving effect to any
waiver, mitigation or extension thereof).


                                       24

<PAGE>

         IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed by its respective duly authorized officer as of the date first set
forth above.

         MERCK & CO., INC.                           MEDCOHEALTH SOLUTIONS, INC.

         By:                                         By:
         Name:                                       Name:
         Title:                                      Title:

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