Pharmaceutical giant Merck has warned of job cuts ahead, despite reporting that its second-quarter profit nearly tripled to just over $2 billion.
The US company is seeking to cut billions of dollars in costs and make savings from its $49 billion acquisition of rival Schering-Plough in 2009. It also faces the imminent threat of patents expiring on key drugs, notably top-selling allergy medicine Singulair.
Merck said it would cut its workforce by 12-13% from end of 2009 levels by 2015, , meaning that 12,000 to 13,000 employees will lose their jobs. But the company pledged to add workers in strategic areas such as emerging markets.
The company operates as MSD in Ireland. A spokesperson for MSD said there were no plans at the moment for any job cuts in the Irish business. MSD recently announced plans for a €29m investment at its plant in West Cork.
Merck said total revenues in April-June were $12.15 billion, a 7% increase from a year ago. Earnings per share excluding once-off items came in at 95 cents, which matched the consensus forecast of Wall Street analysts.
'Double-digit growth from key products, and successful new product launches in markets worldwide led to Merck's strong second quarter results,' chief executive Kenneth Frazier said in a statement.
'Merck is taking these difficult actions so that we can grow profitably and continue to deliver on our mission well into the future,' he said, referring to plans for job cuts.
Merck has been seeking to achieve $3.5 billion in annual savings through its merger with Schering-Plough, one of several mega-mergers in the pharmaceuticals industry in recent years.
