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Derek Lowe The 2002 Model

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Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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March 27, 2009

Layoffs At Merck

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Posted by Derek

I’ve been hearing for a little while about impending layoffs at Merck. I decided, though, that this isn’t the environment to be putting up posts about rumors of job cuts – everyone’s jumpy enough already. But unfortunately, they aren’t rumors any more.

What I’m hearing about, in person and via e-mail, is what sounds like across the board R&D shrinkage For what it’s worth, the damage seems heavier (on a percentage basis) at West Point and in Montreal, but I haven’t heard of any R&D area yet that’s completely missed out. More details are welcome from those closer to the sites affected.

You’d have to think that these cuts have been in the works for a while, but that the Merck/Schering-Plough merger is what’s turned them into reality right now. Still, that’s a bit unusual – most of the time, with these mergers, the job cuts come from the new organization after the merger goes through. With one partner in the deal swinging the ax before that even happens, you wonder what’s going to go on once the two companies merge. Fewer cuts overall than people were estimating (or fewer on the Schering-Plough end? That would be a switch.) Or is this just a head start on something that needed deeper cuts for it to make any financial sense at all?

Either way, if anyone out there knows of some organizations that are in a hiring mood, please feel free to post those details in the comments section. One thing’s for sure – anyone who is trying to fill positions these days will see some good candidates.

Comments (178) + TrackBacks (0) | Category: Business and Markets | Current Events


1. InfMP on March 27, 2009 7:44 AM writes...

Were the layoffs in canada solely PhD level people? That's what I heard.

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2. milkshake on March 27, 2009 8:42 AM writes...

My boss just came back from the conference - its layoffs everywhere and no-one is hiring. Synthetic chemists from good groups go on a second postdoc etc. But there is a light at the end of tunnel from the incoming train.

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3. Ty on March 27, 2009 8:47 AM writes...

The layoff had been in the work prior to the merger, or so I heard. As far as chemists are concerned, the manager level was cleaned out last year and, this time, most non-managerial, expensive (experienced) PhDs were let go. Rumour has it that post-merger bloodbath will happen separately, maybe in a year...

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4. anon on March 27, 2009 8:52 AM writes...

Genentech (Roche) still has open RA and scientist positions.

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5. Petros on March 27, 2009 9:01 AM writes...

Well the European-based ex Organon people are worried, they are in the dark 1 year on from having survived their first merger!

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6. Ed on March 27, 2009 9:04 AM writes...

Merck are closing their Rome site too I think.

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7. Ken Wang on March 27, 2009 9:28 AM writes...

HST is seeking people having experience with SPME/GC/MS

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8. Ken Wang on March 27, 2009 9:29 AM writes...

HST is seeking people having experience with SPME/GC/MS

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9. Don B. on March 27, 2009 10:14 AM writes...

Please don't call these "layoffs". These people are being "fired" usually through no fault of their own.

I would expect the Schering people to be pfizerized. See what happened to the last people hassan "sold out"

Hard times will pass, I think!

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10. E on March 27, 2009 10:35 AM writes...

Most of the job cuts at west point were among upper-level associates, ie people without phds who had been there 5+ years. Some people were offered positions at Merck Boston and some have been invited to reapply at WP for a lower-level position. Several phds were also let go as well as a few people on the bottom. This seriously brings into question the role of non-phds in such situations. Most of the people let go fell victim to their own success as they had promoted to the point that their salaries were apparently not worth their contribution. This is a seriously backhanded move by the management who did the promoting in the firstplace.

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11. sjb on March 27, 2009 11:18 AM writes...

So the latest advert for Merck recruitment on the ACS webpage is nothing but a sham?

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12. Chemjobber on March 27, 2009 11:44 AM writes...

Merck has had that ad up for months. I'll bet they're just fishing.

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13. MTK on March 27, 2009 12:35 PM writes...

In April 2008 Schering announced 5500 layoffs over the next three years. They we In October 2008 Merck announced 7200 layoffs through 2011.

So the current job cuts really are not the result of the merger, since they were going to happen anyway.

The real question is how many of the 12,700 announced pre-merger are among those being counted post-merger. I'm guessing a fair share since the the companies would like to point to as much cost savings as possible due to the merger, even though they were going to cut them anyway.

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14. Robert on March 27, 2009 12:43 PM writes...

These layoffs are just another round of outsourcing to pad the executive's pockets. IBM (a highly profitable company) just fired 5000 US citizens to replace them with Indians. Think about that, they're not down and out, just attempting to maximize gain at any cost.

Look at Bristol Meyers. New jobs in Bangalore!

and their executives got pay raises!!

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15. Thomas McEntee on March 27, 2009 1:27 PM writes...

The 2nd URL in Derek's piece yesterday ("Fan Mail") on Freeman Dyson points to a site with excerpts from Dyson's 2007's the next-to-last paragraph in section 4:

"I am telling the next generation of young students, who will still be alive in the second half of our century, that misfortunes are on the way. Their precious Ph.D., or whichever degree they went through long years of hard work to acquire, may be worth less than they think. Their specialized training may become obsolete. They may find themselves over-qualified for the available jobs. They may be declared redundant. The country and the culture to which they belong may move far away from the mainstream. But these misfortunes are also opportunities. It is always open to them to join the heretics and find another way to make a living. With or without a Ph.D., there are big and important problems for them to solve."

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16. anon on March 27, 2009 1:27 PM writes...

"IBM (a highly profitable company) just fired 5000 US citizens to replace them with Indians."

This, in spite of decades of evidence that out-sourcing IT just mean quality goes to crap.

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17. Sili on March 27, 2009 2:21 PM writes...

Forgive me to stoking the rumour fire, but seem to recall reading recently that Danish pharma claims to be relatively untouched by the Crisis. Even to the point of hiring ...

I know it's not a feasible opportunity for most, but for those desperate it might be worth looking at Novo Nordisk, Novozymes, Leo Pharma and Lundbeck. There may well be others ... I'm not as 'into' the job market as I really ought to be in my current circumstances.

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18. DMGross on March 27, 2009 2:23 PM writes...

Merck also eliminated 178 positions in their facilties groups by shedding the jobs to an outsourcing firm that will now run their facilities for them at sites like Boston and WP. From one standpoint it is a positive as the jobs stay here and it does afford load-leveling, i.e., when you need temporary support for a specific task, the outsourcing firm can provide short-term help to solve a problem and then your headcount returns to normal.

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19. Lucifer on March 27, 2009 2:24 PM writes...

I hate to say this, but I cannot feel any sympathy for them.

Having met quite a few of these 'big pharma' people at conferences (esp. Merck and BMS), I have to say that their level of arrogance, conceit, lack of innovation and belief in the totality of their knowledge (hubris) alternately amused me and horrified me.

Unless you have been involved in discovering a novel molecule that showed any decent therapeutic activity in a Phase II trials (toxicity notwithstanding) please stop acting like you know it all. I am happy to hear from people who have even one decent novel phase II molecule to their name even if its activity was no better than an existing class of drugs or it had unexpected toxicity. In my opinion, that is is what entitles you to opine on the field, unless you are promoting the safety of vioxx after large clinical trials demonstrated a 3-4 fold increase in death from all causes in the elderly.

However, if you reached your fancy sounding position through an ivy league university, pedigree, BS, intrigue and have spent the last 10 years working on developing the marginally better isomer of an existing compound.. please shut up.

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20. XFZ on March 27, 2009 3:49 PM writes...

A few of my friends got Merck offers recently. Are these offers in danger? Should they report to Merck as soon as possible?

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21. XFZ on March 27, 2009 3:50 PM writes...

A few of my friends got Merck offers recently. Are these offers in danger? Should they report to Merck as soon as possible?

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22. Jose on March 27, 2009 3:54 PM writes...

I can't help but wonder if the ACS's new sexy slogan of "Chemistry for Life" is just sick and twisted irony from the laughing suits that are running the show....

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23. Mark on March 27, 2009 4:19 PM writes...

One has to wonder if, and how long from now, recent mergers will affect business at US CRO's (ie Covance, AMRI which have significant contracts)?

any thoughts?

and an related outsider article...

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24. no name on March 27, 2009 6:47 PM writes...

Merck is still hiring. This was simply a house cleaning move on their part. I know people who have received/accepted offers (with confirmation that they are still good) and people who have been laid off (yesterday to be exact). It truly is unfortunate for the upper level associates.

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25. no name on March 27, 2009 6:47 PM writes...

Merck is still hiring. This was simply a house cleaning move on their part. I know people who have received/accepted offers (with confirmation that they are still good) and people who have been laid off (yesterday to be exact). It truly is unfortunate for the upper level associates.

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26. Merck Insider on March 27, 2009 7:18 PM writes...

#10 and #13 are correct. The people getting laid off in the Merck Research Labs are people who got tripped up by their own promotions. For the last decade or so, the research division has promoted people pretty freely. A lot of folks ended up with the salary and title of a mid-level manager, but without the impact or number of people under them to justify it. This culling of over-promoted employees (referred to as "delayering") began last fall and for some reason is just now hitting certain areas of research.

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27. Anonymous on March 27, 2009 7:34 PM writes...

Merck & Schering people live in the same communities in NJ. There is lots of talk amongst them, especially regarding the layoffs. The general feeling is that Merck people are getting it now, and Schering people will be axed in about a year. The combination seems impossible - the cultures are vastly different - too different to merge as Clark professes they will. While there are plenty of arrogant Merck people, there are plenty of quiet, good scientists there too. Schering people have come out of the consent decree by working very hard in focused teams to deliver a terrific pipeline. Fred really had persuaded the Schering group that the hard work would all pay off in the end, but neglected to say that the pay off was his, not theirs. These are two contrasting pharma houses - one with good solid management and the dedication of the people, and one with coercive management that no bench scientist trusts. One is bleeding good scientists, arrogant and not, for reasons that their management alone knows, and the other is full of shell-shocked zombies, betrayed by their leader.
No vision has emerged on how these two will merge. Not to mention the Organon folk. No vision usually spells disaster. The number of research engines destroyed (Lost Civilizations) in the US is alarming. This lack of diversity and creativity is a disaster not only for scientists and their families, but for the population as a whole, at some point. Where will new drugs come from? Fewer and fewer places...not a good trend.

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28. drug_hunter on March 27, 2009 7:55 PM writes...

So, according to the aptly-named Lucifer, only about one chemist in 10 (maybe less) has a right to voice an opinion. Interesting worldview.

And everyone he meets from big pharma is arrogant, conceited, etc. Nice generalization.

I might add that most of the people that I've met who have contributed to a Phase II success still don't know as much as they think they do ... and that probably applies to me too ... and, dare I say, to the devil himself -- who needed bother to apply to my shop when he finds himself on the short end of the stick someday.

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29. Mark on March 27, 2009 8:26 PM writes...

Could anyone please point to other places where this topic is currently being discussed online?

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30. Lucifer on March 27, 2009 9:50 PM writes...


I have been inside that world, and realized the futility of working in it a few years ago. It was, and still is, a MBA/Lawyer/Pedigreed Researcher driven Ponzi Scheme.

Let me put it this way.. I have no reason to be looking for a job in a company. Working with **holes is much more fun than working under them.

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31. Fox Mulder on March 27, 2009 9:53 PM writes...

Most of the chemists laid off at Merck, West Point were non-PhDs. The majority were people who devoted their careers to Merck and had been there many years. These are not the arrogant people at meetings, referred to above but hard working BS & MS people whose hard work and loyalty got them stabbed in the back by the company they helped make successful. Merck's upper management should be ashamed of the immoral disservice it has done to its people, customers and our countries economy while it pulls in money hand over foot.

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32. Neo on March 27, 2009 11:24 PM writes...

To any pursuing a PhD/MS in chemistry reading this article.

Quit, walk away.

You've been warned. You've got better odds in Vegas at making money (an at least you'll get free booze).

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33. LFree on March 28, 2009 12:16 AM writes...

Pfizer in San Diego is hiring much with still lots of openings, but forbid us here to give credit to this smart survivor, in contrast to several non-survivors. (And I still wonder about DL if he was personally research productive in a meaningful way at the company that laid him off to justify his acerbs, consistent with the Lucifer #19 above). Oh yeah, literary style wise, I meant to throw in an "indeed".

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34. anon on March 28, 2009 9:37 AM writes...

Neo - Yes, if I had been able to see the future about 10 years ago I would have walked away. It is a little too late for most of us.

All - I have a MS and about 7.5 years of experience. I am at the level below an entry level PhD, where I realistically expect to stay under the current economic situation (and political situation within the group - getting the next promotion really seems to depend on being in the right spot at the right time, and I am probably a little too late to the party). I was exploring other options for awhile, however it seems like alot of the big IP firms have also been laying off (along with everyone else it seems) and getting into alot of debt and not having a job doesn't seem too bright. What is the answer if you are already caught up in this mess? I am hanging in since I am still employed, but am concerned about something like what happened to the Merck people happening to me when I am no longer able to work the long hours, etc. How many 50+ year old MS chemists are still around? Even mid-late 40's? Think about it.

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35. MTK on March 28, 2009 10:37 AM writes...


I'm glad you called out Lucifer. I was going to do the same, but halfway through my comment decided it wasn't appropriate.


I have an inclining that you're fun to work with.

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36. Anonymous on March 28, 2009 11:40 AM writes...

So is the moral of this story that I, as an MS chemist, can have better job security if I stop working so hard and not get promoted as much? Or is it that the lower-performing older BS/MS folks had already been pushed out, and now they are getting rid of the higher-performing ones?

I don't know anything about the legal aspects of these things, but, if these are older folks who are still high-performers, how can they justify laying them off? Depending on the scale of these layoffs, if it was a small percentage of the department and if they were all in a similar demographic, could they sue for age discrimination, or are things so murky that you can't really get away with that sort of suit?

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37. anon2 on March 28, 2009 12:48 PM writes...

A few facts from the inside:

1. These layoffs are part of a total reorganization of basic
research, all levels from entry level B.A./B.S. to 20+ years
Ph.D. This has been planned for a long time and has nothing to
do with the Schering merger, although it "prepares a more
efficient structure". Expect a further re-org during/after the

2. Mean layoff of 20%, but variances are wide. West Point (PA)
chemistry is particularly hard-hit, especially at the higher pay
grades. Unlike what some others have said, both non-Ph.D. and
Ph.D.s are heavily hit. In short, there are a smaller number of
upper-level scientific positions in the new organization (and
more lower-level ones). The employee assessment process, which
determines what if any role one is assigned in the new structure,
is opaque. This has not been handled well.

3. However, there is some continual hiring and reshuffling to
fill opening positions. Some of these will be lower-level, some
are to build new areas, part of the usual hiring process that
always goes on. Long-term, the expectation is to build back to
similar numbers in basic research. Although the distribution may
be very different (grade level, speciality). So I think the job
ads are real.

Some previous posters have said that these folks
were "over-promoted". I think this belief comes from the desire
to find some rationale as to why "we" won't get fired.

Although there are some limited cases of over-promotion, I don't
believe it's true in general at Merck. Instead, I see a lot of
excellent colleagues with significant experience being let go.
Senior management is gambling that they can hire proportionally
more entry-level or outsourced resource with the same or fewer

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38. Lucifer on March 28, 2009 1:05 PM writes...


I have higher standards of ethics than the majority of middle and senior management.

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39. GAR on March 28, 2009 2:37 PM writes...

Used to work for Merck. In fact I worked there for 9 years. The first five years were great, then after the Vioxx withdraw its been layoff city, constantly looking behind your back, not knowing if the Turk was coming or not. I left there, starting working for a small company where I am not a number and things are great

I will say this, when I first was hired at Merck I could not believe the way the wasted money, I couldn't believe how heavy every single department was in labor.

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40. Fox Mulder on March 28, 2009 5:48 PM writes...

77% of the recent chemistry layoffs at West Point were non PhD's, most with many years working for Merck. The average age of all the chemist just let go is 41 years. Twentyeight (28) of these people are 40 or older. Of non PhDs in the top 2 grade levels (these are the people who have been at Merck for years and dedicated their careers to the company) 78% of them are now unemployed. There is no moral way to justify this. It should be illegal.

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41. BeenthereDoneThat on March 28, 2009 6:47 PM writes...

I sympathise with your views Fox, but what about the indiscriminate loss of jobs that comes with a total site closure? Surely that is even more immoral? Basically, Merck is one sick old dog and the senior management are responsible for this. They are the ones who should pay the price but we all know they won't.

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42. anonymous on March 28, 2009 7:10 PM writes...

Merck Basic Research just laid off 20% of its employees, which was not planned. I guess that this is to make room for schering plough colleagues to make up the new Merck, which means 20% of basic research staff will be placed in the new queendom of Kathleen Metters, the queen of MRL basic research. She may keep a few more just to show the promise of placing the majority of SP employees is kept. However, she is planning BRGOS 2, in which she may eliminate all the SP employees or ask them to relocate to Canada!!

Who were laid off this time?

1. People who are in their late 40s or 50s and have been with the company for >10 years plus one of these:

* lack leadership, which means strong scientists and solid performers but do not b***s**t
* speak up
* do not kiss asses

2. Pattern breakers - random picks of young scientists who have been with the company for 5 years or fewer

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43. Just laid off from Merck Basic Research on March 28, 2009 7:37 PM writes...

Merck Frosst in Canada just laid off 38. About 20% of the basic research.

Majority of them older employees with >10 years of service (75%). A rough estimate

The chance of getting laid off if you are >45 and has been with the company for >10 was >60%

The chance of getting laid off if you are Chinese in the biology department (in vitro and in vivo) was greater than 80%

The chance for young employees of being picked randomly as pattern breakers was 5%

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44. anony on March 28, 2009 7:58 PM writes...

Sounds like age discrimination but delibrately covered up by throwing in a few younger employees

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45. legal aid? on March 28, 2009 8:00 PM writes...

Any one knows a good labor lawyer?

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46. xfz on March 28, 2009 8:41 PM writes...

As a scientist in this field, reading these comments is very depressing. For many years, Merck is known for its good quality of science, yet it's the scientists are paying the price of failure of its management. I am wondering what is the percentage of its middle- and top-management will let go? Any info from insiders?

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