Merck laying off managers in research and development unit

Drugmaker Merck is laying off an unspecified number of managers as it tries to cut costs and get more from its research and development unit, Merck Research Laboratories.

"MRL’s organizational structure has been altered to simplify governance so that Merck can advance therapeutic and vaccine candidates more efficiently and focus resources on its most promising programs," Merck spokesman Steve Cragle said in an email. "The new design has been established to ensure that MRL leaders have the authority to take appropriate actions to facilitate rapid pipeline progress. It is too early to provide numbers or comment on any individuals that may or may not be affected by these changes."

Like many drug companies, Merck is searching for new drugs to replace highly profitable medicines that lost patent protection and now face generic competition. The asthma drug Singulair is one example. Also like the other drugmakers, Merck facing price pressure from insurers, public and private, especially in Europe.

In March, Dr. Roger Perlmutter replaced Dr. Peter Kim as leader of the R&D unit.

In a conference call with stock market analysts on May 1, following release of first-quarter financial results, Perlmutter said he would make changes.

"When you bring in a new guy with a fresh set of eyes, there are going to be some changes," Perlmutter told the analysts that day. (Inquirer story link here.) "I'm doing a detailed review of programs, processes and people. Already two weeks into the job, I can say there are some opportunities for acceleration and productivity enhancement."

Derek Lowe, who writes the pharmaceutical industry blog, "In The Pipeline," reported the management changes early Friday.

Dr. Roger Pomerantz, senior vice president and head of infectious diseases, is among those managers leaving. Pomerantz declined comment on the changes when reached by the Inquirer Friday evening.

Merck's headquarters is in Whitehouse Station, N.J., though it will be vacating that facility in the next couple years and shifting leadership offices to Summit, N.J.

Merck has research and manufacturing operations in West Point, Montgomery County.

Local 10-00086 of the United Steelworkers Union represents about 2000 workers at the plant, but none of them lost jobs in this round of cuts, a union official said. The union agreed to a new, three-year contract with Merck in May.