Merck & Co. disclosed yesterday that it has eliminated more than 85% of the 8,500 positions slated for elimination under its 2013 restructuring of R&D and commercial operations.
The pharma giant said in a regulatory filing that it had eliminated “approximately 7,290 positions” consisting of employees, contractors and vacant jobs since the start of its 2013 restructuring, at a total pretax accumulated costs of approximately $2.7 billion.
The 7,290 includes 1,195 positions eliminated during the first half of this year—of which 460 were cut during the second quarter Merck stated in its latest quarterly Form 10-Q filed yesterday. The company recorded total pretax costs of $159 million toward the cuts in Q2, part of the $217 million recorded for the first six months of 2015.
Positions eliminated were in “sales, administrative, and headquarters organizations, as well as research and development,” Merck added.
In addition, Merck eliminated 755 positions during the first six months of 2015—about 400 of them during Q2—as part of an earlier restructuring launched in 2010 after the company acquired Schering-Plough. As with the 2013 restructuring, the eliminated positions included employees, as well as by contractors and vacant positions.
Since 2010, Merck has recorded total pretax accumulated costs of approximately $8.2 billion and eliminated approximately 29,160 positions in connection with the post-Schering-Plough layoffs. The costs include total pretax costs of $169 million during the second quarter, part of $336 million recorded for the first half of this year.
“The non-manufacturing related restructuring actions under the Merger Restructuring Program were substantially completed by the end of 2013. The remaining actions under this program primarily relate to ongoing manufacturing facility rationalizations, which are expected to be substantially completed by the end of 2016,” Merck stated.
Merck disclosed job elimination and cost figures in its most recent Form 10-Q quarterly results, filed with the U.S. Securities and Exchange Commission. Merck finished the second quarter with GAAP net income of $687 million, down 66% from $2.004 billion during the year-ago quarter, while Q2 sales slid 10.5% year-over-year to $9.785 billion
Exclude acquisition- and divestiture-related costs, restructuring costs and certain other items, including foreign exchange losses related to Venezuela, Merck non-GAAP net income slid just 2%, to $2.441 billion from $2.494 during the second quarter of 2014.
