Merck Job Cuts: 16,000 Employees Face Termination

Merck job cuts will affect 16,000 employees. The cuts are expected to save the pharmaceutical giant $2.5 billion per year. In addition to slashing their workforce, the company will move their headquarters to the Summit, New Jersey, location.

The current headquarters in Whitehouse station, New Jersey, will close.

In their “multi-year initiative,” Merck & Co will focus their efforts and investments on commercial interests, research, and development. They hope to reduce costs while focusing on “opportunities that have the potential to deliver the greatest return on investment.”

As explained in an official statement posted by Business Monitor, the Merck Job cuts are a necessity. However, it was not an easy decision:

“While these actions are essential… they are nevertheless difficult… they affect our dedicated and talented colleagues… We appreciate the contributions of all our employees… we will support them during this time of transformation”

Merck officials say the savings will allow the company to remain competitive. The increased revenue will be used to create new and better medications, including vaccines.

The pharmaceutical company’s long-term goal is to appeal to patients, consumers, and shareholders. The goals are organized into several sections; redesigning operations, reducing costs, increasing commercial focus, and refocusing research and development.

Merck expects to see a savings of $1 billion by the end of 2014, and a savings of $2.5 billion by the end of 2015. The lesser amount in 2014 includes employees severance pay.

A majority of the eventual savings is expected to come from administrative costs and marketing.

The restructuring will also affect several products in the testing stage. Products unlikely to succeed in trials will be pulled. Others will be licensed to other pharmaceutical companies.

Outside the US, Merck is known as MSD. They create and manufacture prescription medication, vaccines, consumer care, and pet care products.

The Merck job cuts will affect the lives of at least 16,000 people. However, executives say the cuts are necessary to continue to succeed.

[Image via Wikimedia]