Drugmaker Merck & Co. announced today it is cutting 7,000 jobs or about 11% percent of its worldwide staff, as part of a $4 billion restructuring plan. The New Jersey-based manufacturer, the nation's second-largest drugmaker behind Phizer, said it will also close or sell five of its manufacturing plants, but did not name plant locations. About half of the staff cuts would come from Merck's U.S. operations, which include seven of its 31 worldwide plants.
All restructuring changes are expected to take place by the end of 2008. In an industry release, Merck said its moves are the initial phase of a broader cost-reduction program, which is expected to save the company as much as $4 billion annually from 2006 to 2010. They are the first major action of the company's new CEO, Richard Clark, who replaced Raymond Gilmartin in May. Gilmartin led the company at the time of its Vioxx-recall problems in September 2004.