EMCC European Monitoring Centre on Change



Geographic Location

Country: World


Sector: Manufacturing
Manufacture of pharmaceuticals, medicinal chemical and botanical products
21 - Manufacture of basic pharmaceutical products and pharmaceutical preparations
Number Employed: 62000

Employment Effects

Announcement Date: 28-11-2005
Planned Job Reductions min: 7000
Planned Job Reductions max: 7000
Type of Restructuring: Internal restructuring
Foreseen End Date: 31-12-2008
Direct Dismissals: 7000

Additional Information

The leading pharmaceutical company Merck announced an important worldwide reorganisation plan which should include some 7,000 redundancies out of total 62,000 group’s employees and the closure of five of its 31 worldwide manufacturing plants, as well as one basic research site and two preclinical development sites, by 2008, with a view to realise cost savings of around $4 billion by the end of the decade. About half of the reductions are expected to occur in the United States, while the remainder will involve its worldwide operations, which include a number of locations in Europe. The reorganisation will include diversification of suppliers and the outsourcing of some of the production activities. In mid-December 2005, the company disclosed some elements of its new strategic plan and increased its cost-reduction target to some $5 billion by 2010.