Mer­ck trig­gers a new round of lay­offs in R&D re­or­ga­ni­za­tion, push­ing more jobs in­to Cam­bridge, San Fran­cis­co

Mer­ck is con­firm­ing that it’s trig­gered a new round of lay­offs in its R&D group as it con­cen­trates and ex­pands its drug re­search work in two ma­jor biotech hubs, Cam­bridge, MA and San Fran­cis­co. The re­struc­tur­ing in­cludes adding a new lab in Cam­bridge, which will fo­cus on the fast-grow­ing mi­cro­bio­me field.

A spokesper­son for Mer­ck tells me:

“With­in Mer­ck Re­search Lab­o­ra­to­ries, we are mak­ing some or­ga­ni­za­tion­al changes with­in our dis­cov­ery, pre-clin­i­cal and ear­ly de­vel­op­ment area to en­able ear­li­er ac­cess to emerg­ing ex­ter­nal sci­ence and tech­nol­o­gy to aug­ment our lead­ing dis­cov­ery and de­vel­op­ment ca­pa­bil­i­ties. These changes in­clude in­creas­ing our in­vest­ment in ex­plorato­ry bi­ol­o­gy in ar­eas where bio­med­ical re­search is con­verg­ing, specif­i­cal­ly in Cam­bridge, Mass. and the San Fran­cis­co Bay area, Calif.  Un­for­tu­nate­ly, these changes will re­sult in work­force re­duc­tions at our Ke­nil­worth and Rah­way, N.J. sites and our North Wales, Pa. screen­ing fa­cil­i­ty as we shift re­sources and per­son­nel.

“Ad­di­tion­al­ly, here’s some back­ground on Cam­bridge and the San Fran­cis­co Bay area sites:

“We are ex­pand­ing MRL’s ear­ly dis­cov­ery re­search ca­pa­bil­i­ties by in­vest­ing in new lab­o­ra­to­ries at our Cam­bridge, Mass. site. Re­search will fo­cus on emerg­ing sci­ence, ag­nos­tic of ther­a­peu­tic area. Ini­tial ex­plorato­ry re­search will in­clude host-pathogen in­ter­ac­tions and the role of the mi­cro­bio­me in dis­ease process­es. The site is sched­uled to open in late 2016.”

The spokesper­son de­clined to spec­i­fy ex­act­ly how many jobs are be­ing cut. “We’re not pro­vid­ing a break­down of the changes or spe­cif­ic num­bers at this time, as it will in­clude sep­a­ra­tions and moves,” she not­ed.

Mer­ck’s move fol­lows a ma­jor trend in bio­phar­ma R&D, as the biggest com­pa­nies con­cen­trate more and more of their work in the big hubs. And vir­tu­al­ly all of the ma­jor play­ers have down­sized at one time or an­oth­er.

Close to three years ago, Mer­ck trig­gered a ma­jor re­or­ga­ni­za­tion in its R&D ranks, as the then new R&D chief Roger Perl­mut­ter set in mo­tion a plan that in­volved 8,500 lay­offs, all of which were piled on a re­struc­tur­ing ef­fort that was an­nounced ear­li­er.

Those lay­offs fol­lowed a years-long gap in sig­nif­i­cant new drug ap­provals and a string of clin­i­cal set­backs. Since then, though, Mer­ck land­ed a land­mark ap­proval of Keytru­da, now the num­ber two check­point in­hibitor on the block­buster can­cer mar­ket, along with an OK ear­ly this year for its hep C com­bo, Zepati­er, which is be­ing sold in a ri­val-in­fest­ed field.

Derek Lowe at In the Pipeline, a close­ly fol­lowed blog that has fre­quent­ly been a leader in flag­ging scut­tle­butt about R&D re­or­ga­ni­za­tions, was the first to spot­light ru­mors of a move. He re­port­ed:

The North Wales, PA site is be­ing closed (the screen­ing op­er­a­tions there are mov­ing to Ke­nil­worth). New Jer­sey dis­cov­ery chem­istry (Ke­nil­worth and Rah­way) is be­ing cut by 20%, and Rah­way’s med-chem is en­tire­ly mov­ing to Ke­nil­worth over the next few months. Dis­ease area bi­ol­o­gy in Ke­nil­worth is shut­ting down (not sure what the ram­i­fi­ca­tions of that one might be). I’m told that some peo­ple will be of­fered a chance to move to the Boston or Bay area sites, and all of these de­ci­sions will be made by the end of Sep­tem­ber. And ap­par­ent­ly they’ve al­so told every­one that more changes will be com­ing in the next few weeks, so I’m sure that’s calmed every­thing down as well.

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