Merck & Co. plans to lay off approximately 500 U.S.-based employees working on sales and commercial teams, the company disclosed Thursday in a regulatory filing and confirmed Friday to BioPharma Dive.
Affected employees, who are spread out across the country, will be laid off on Jan. 3, 2020 with separation packages, according to a company statement. The pharma giant is also adding U.S. jobs focused on oncology.
“This is not a new restructuring effort,” Merck spokesperson Pamela Eisele said in a statement. Instead, the layoffs are part of “ongoing company-wide efforts to sharpen Merck’s focus” on R&D growth opportunities.
Workforce reductions have been a trend across the large pharma industry, and Merck is no exception. Since the 2009 merger with drugmaker Schering-Plough, the last decade for Merck has been marked by booming financial success and a steadily shrinking headcount.
Following the Schering-Plough deal, Merck launched major restructuring efforts in 2010 and 2013 — the first stemming from integration with the fellow drugmaker and the second to narrow its R&D focus. All told, those resulted in the company eliminating more than 45,000 positions through the end of 2018.
Over the past decade, Merck’s stock price increased roughly 125% while the number of workers employed by the pharma shrunk from about 100,000 following the merger to approximately 69,000, according to a review of regulatory filings.
Merck has also reduced its U.S. workforce by 40% in the past decade to 25,400 workers at the end of 2018. These newest job cuts appear set to further lower that figure, although a Merck spokesperson noted the pharma is hiring for U.S. oncology-focused jobs, without specifying how many.
Merck’s financial success in recent years is due in large part to the leading position held by cancer immunotherapy Keytruda (pembrolizumab), sales of which surpassed $7 billion in 2018.
Wall Street analysts expect sales of the blockbuster drug to only keep growing. Earlier this year, for instance, Cowen & Co. analyst Steve Scala forecasted $10.9 billion in 2019 Keytruda sales with $20 billion possible by 2024.