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DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

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: derekb.lowe@gmail.com Twitter: Dereklowe

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October 28, 2011

Merck, And What Used to Be Schering-Plough

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Posted by Derek

The cutbacks at Merck seem to have been pretty severe, if the messages that I'm getting from former Schering-Plough people are any indication. A lot of longtime R&D people have been let go, which is no surprise when you see what's been happening over the last few years with Pfizer's acquisitions (just to pick the biggest example). Experience, past accomplishments, and ability are not very high at all on the list of factors being judged when it comes to this point.

It's worth asking just how well that whole Schering-Plough deal is going for Merck, though. Here's a thorough breakdown of all the pipelines at the time the deal was going through. You can see that some of the areas (women's health, respiratory) have worked out as planned, but some others (cardiovascular, hepatitis C) have definitely not. And (as that link makes clear) one of the big variables when the deal went through was how much money would be left from the J&J deal after arbitration. If you look at the company's earnings, it's a mixed bag. Singulair is the biggest on the list, but that one's going off patent next year. Remicade is bringing in some money, after the territories were split up, with Merck holding on to Europe, Russia, and Turkey. The only other product from the Schering-Plough deal on the top-selling list is Nasonex, and that just makes the cut.

I just have to wonder how different this press release would have been if the deal hadn't gone through at all. But sales figures aside, what we don't see is the huge disruption in research and early development, just as you don't see that in Pfizer's deals over the years. You don't notice the drugs that don't get discovered, the early projects that don't quite advance. Was it all really worth it?

Like all the other mergers, this one only makes sense if you factor in big cost reductions - that DataMonitor link above makes this clear. And Merck does indeed look as if they're cutting their expenses as planned, so perhaps these numbers will come out right on target, and earnings-per-share will follow along. But what happened to Ken Frazier's brave attempt to withdraw EPS guidance entirely and focus on rebuilding the company's R&D? Was that just window dressing, was it an honest effort to change things that has now been abandoned, or what?

Comments (72) + TrackBacks (0) | Category: Business and Markets | Drug Industry History


COMMENTS

1. Quintus on October 28, 2011 9:06 AM writes...

It may not help, but my thoughts are with those people and their families who no longer have a source of income. I wish them all the best.

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2. Tt on October 28, 2011 9:49 AM writes...

It cannot be overstated the severe impact on the early pipeline that this merger and subsequent layoffs, reorganizations, and reprioritizations has caused. Morale has never been lower and all the good people who can find jobs are leaving in droves. It's a toxic environment and I see little chance that shmerck will ever recover from a research perspective. A sad requiem for a once proud company.

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3. Anonymous on October 28, 2011 10:10 AM writes...

I think Ken's desire is / was honorable. Unfortunately an objective evaluation of the productivity of the Merck R&D organization would suggest that his confidence in the leadership is misplaced. While it is quite easy to say "all of pharma is suffering", Merck once used to distinguish itself by it's ability to survive in uncertain times. A lost decade of research leadership under Peter Kim and his recrafted organization underlies the unsustainable construct that is the current Merck.

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4. petros on October 28, 2011 10:47 AM writes...

The great hope of revenues (for Merck) from S-P's boceprivir doesn't seem to be realised. After a few months of both on the market it has just over a 10% market share while Vertex'telapravir seems on track to hit $1 billion revenues this year having only been approved in May

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5. PharmaHeretic on October 28, 2011 11:27 AM writes...

Do you still believe that the actions of management in such corporations are guided by anything other the following-

1. Need to speedily extract maximum equity out of a corporation, damn the consequences.

2. Need to appear competent, knowledgeable and polished while doing 1.

3. Need to abuse people while doing 1. and 2.

Whether you like it, or not, the last 20-30 years have seen entire industries being captured, ruined and destroyed by people who are effectively sociopaths. Pharma is just one of the many industrial sectors being decimated by the unwillingness of people to do something substantial about the problem.

One of the more amusing aspects of this ongoing tragedy is that many people not yet affected by sociopaths stand behind them in the hopes of getting rich. Newsflash- You ain't getting rich by sucking up to such people and are probably next in the line for getting shafted.

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6. anonymous on October 28, 2011 11:44 AM writes...

As one who was let go as a senior level manager, I and other like me saw the creeping decay beginning about 10-12 years ago, when Tony, Lex, and other senior management simply stopped listening to their middle science managers and replaced them with lackey’s and sycophants. It went downhill from there. One senior chemistry manager, to illustrate the utter intellectual and moral (yes, moral vacuum), derided Art Patchett, who's scientific acumen in the ACE and lipidimic area drove Merck's earnings in the late 80's, 90's, as a "dinosaur" that just didn't understand where Med Chem was going. Other like me stood mute for fear of retribution from Peter Kim and Tillyer. We were powerless.

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7. Student on October 28, 2011 11:53 AM writes...

It looks like these guys just want others to do the work for them. Excerpt from an interview with Sanofi's Viehbacher:

"Q: What do you see as the biggest challenges for your company and the industry?

A: As we're looking at deficit reduction in both Europe and the U.S., there's huge threats to our industry. ... I think it's going to be extraordinarily important to preserve the ability of the NIH (National Institutes of Health) to invest in research, make sure the FDA (Food and Drug Administration) has the means that it needs. ... It's never been the case that science has been so promising in terms of what it can do for increased health. People are really starting to understand causes of disease, understanding the genomics behind this. ... But at the same time, it has never been more difficult to fund a new idea. Venture capital has pretty much gotten right out of healthcare. ... So I think there has to be a greater demonstration that we can convert a great idea scientifically into a patient benefit with increased frequency -- and faster."

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8. My 0.02 on October 28, 2011 11:58 AM writes...

One thing I have been thinking about is the impact of these endless reorg and downsizing at big pharma on SIGMA-ALDRICH. I am pretty sure that big pharma R&D counts for a big chunk of their business. Sure, SIGMA-ALDRICH has presence in Chindia. Compared to the astronomical margin on research chemicals they can get away with it here, in Chindia, they have to compete with the suppliers that actually made these chemicals in the first place.

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9. HappyDog on October 28, 2011 12:06 PM writes...

6. anonymous

Art Patchett has probably saved or improved the lives of millions of people through his contributions. He did all of this while Merck gradually whittled his lab down to a smaller and smaller size. One of my colleagues said that when he left Merck, Art was still there with two associates, and outproducing the 30+ sized research groups who had fully embraced the combichem paradigm.

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10. Will on October 28, 2011 12:07 PM writes...

Sigma Aldrich pays its people peanuts.

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11. This guy on October 28, 2011 12:08 PM writes...

What #2 said. The morale is in the basement, people will do what ever they can to stay employed, and many who can leave have left. It seems that people who are protected, for whatever reason, will continue, and those with no advocate will be let go regardless of their abilities. So sad.

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12. AlChemie on October 28, 2011 12:21 PM writes...

makes one wonder who 'advised' them and what were they smoking when they went over the portfolio
KF did a wonderful job managing the Vioxx suits but does that make him the 'best' leader for the company, too many MBAs not enough MDs

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13. Eponymous on October 28, 2011 12:22 PM writes...

I had the distinct honor to work with such distinguished scientists such as Paul Anderson, Steve Young, Joe Vacca, Mark Bock, and Roger Freidinger at WP. Tremendous scientists. Sadly, this industry does not seem to be able to product this level of talent anymore. Much of what passes as "scientific leadership" these days is nothing more than politically correct toadys. Very sad.

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14. Morten G on October 28, 2011 12:42 PM writes...

When you ask whether it was worth it for Merck, do then mean Merck the company, the staff, the executives, or Merck the shareholders?

I'm guessing that that's four different calculations.

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15. Anonymous on October 28, 2011 7:58 PM writes...

It was not worth it for either Leg-SP or Leg-Mrk staff, that's for sure. The execs got huge bonuses, and payouts for walking away. Shareholders got cash for their SP stock when it converted. Maybe for them. For the company as a whole - no. Only if Kim and all his incompetent cronies, and even down to most dept heads, had been rooted out and replaced with some venerable SP folk, or even outsiders, would it have been worth it for the company. The merger was a perfect opportunity to stimulate change in sclerotic Merck. But no, the execs and Kim et al used it to expand their fiefdoms, line their pockets with their bonuses, and practice their well-honed people management skills that would put the Marquis de Sade to shame.

Projects, what projects? No one talks about projects. Management is directly responsible for the wholesale destruction of the early pipeline brought over from SP. And no one seems to know what projects Merck really had in the early phases - its all smoke and mirrors.

Unsustainable is not the right word for Merck - but that's OK. Merck, once proud or otherwise, doesn't give a hoot about the patients. Its all about the money. Which management expects will pour in from BRICK - which is why a new HQ is under construction in Beijing. Its called Merck One. Who wants to bet on how long til Merck is no longer a US-based company?

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16. whocares on October 28, 2011 9:18 PM writes...

a Legacy SP scientist who just get laid off went on to a plane going to Florida only find out that he is in the same plane with the previous notorious SP CEO Fred Hassan. He went straight to him and tell him that he just get laid off. Now let's guess, what do you think will go through Fredy's mind? My guess is that OMG, is he gonna punch me?
BTW, this is a true story.

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17. Anonymous on October 28, 2011 10:15 PM writes...

#13. While in Kenilworth as 'head of chemistry' Joe Vacca did nothing but insult legacy S-P employees while contributing absolutely nothing to the programs. How can someone who is obviously so inept, while trying to claim inventorship to Crixivan and the integrase molecule which clearly came from the IRBM group in Italy be regarded as a distinguished scientist. In the end he did not even have the guts to stick out his tenure in Kenilworth, clearly retreating to West Point for the last few months to the beginning meaningless life at Merck.

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18. Anonymous on October 28, 2011 10:16 PM writes...

It was not worth it for either Leg-SP or Leg-Mrk staff, that's for sure. The execs got huge bonuses, and payouts for walking away. Shareholders got cash for their SP stock when it converted. Maybe for them. For the company as a whole - no. Only if Kim and all his incompetent cronies, and even down to most dept heads, had been rooted out and replaced with some venerable SP folk, or even outsiders, would it have been worth it for the company. The merger was a perfect opportunity to stimulate change in sclerotic Merck. But no, the execs and Kim et al used it to expand their fiefdoms, line their pockets with their bonuses, and practice their well-honed people management skills that would put the Marquis de Sade to shame.

Projects, what projects? No one talks about projects. Management is directly responsible for the wholesale destruction of the early pipeline brought over from SP. And no one seems to know what projects Merck really had in the early phases - its all smoke and mirrors.

Unsustainable is not the right word for Merck - but that's OK. Merck, once proud or otherwise, doesn't give a hoot about the patients. Its all about the money. Which management expects will pour in from BRICK - which is why a new HQ is under construction in Beijing. Its called Merck One. Who wants to bet on how long til Merck is no longer a US-based company?

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19. Quo vadis, Schering-Plough? on October 28, 2011 10:44 PM writes...

Taking a break from pharma-centric banter, does anyone know if Mega-Merck will follow the lead of Pfizer and BMS by divesting non-pharma business units? For a professional organic chemist, it is becoming ever harder to avoid the stereotype of being fit to work only in med chem or process.

Why should having an advanced degree in chemistry exclude anyone from a job in developing non-drug consumer products? I doubt that everyone developing household cleansers, cosmetics, or whatever had learned specific formulation skills in grad school. Sure, suntan lotion (SP's Coppertone) or mouthwash (Pfizer's Listerine) may not carry the same "prestige" as a cancer therapeutic, but the profit margins on the former products are much larger and their liabilities are much smaller.

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20. S-P employee on October 28, 2011 10:55 PM writes...

Thanks Fred.

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21. Anonymous on October 28, 2011 11:33 PM writes...

@2,5, 6 and others...While all these layoffs are nasty, I sincerely hope that it spawns some new start up biotechs. There is so much talent on the street now. Looking back on who was let go and who was retained at merck, roche, pfizer etc... it is clear that the layoff artists are bleeding and there is no future...

Let's go people! We all need to pull together, get some startup's going and show the big pharma BS who's boss!

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22. Anonymous on October 28, 2011 11:47 PM writes...

@17 Didn't Joe Vacca also shut down Merck Frosst? This guy seems to be moving around. Never met the man but my "perception" was that his reputation was good.

Where is JJP from the chemistry group at the KW site? Seemed to me to be a great positive influence...

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23. Goldmember on October 29, 2011 1:56 AM writes...

Letsh not forget all the dutsch peeple who could afford a nisch schmoke-and-a-pancake when employed by Organon. Mishter Hassan came in to buy a nice schmall company which was quite profitable (I love gold!). But Fred it scheems loves gold more than I and so he shold the Dutch to a real Dick. And now all the Dutch no longer have a place to work. I think we must rise up and feed these guys to the sharks-with-frikin-lazer-beams.

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24. Anonymous on October 29, 2011 7:14 AM writes...

@13 compels me to revive an old Sesame Street jingle from back when I was a kid.

"One of these names is not like the others.
One of these names just doesn't belong.
One of these names is not like the others.
Can you tell me which one by the time I finish this song?"

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25. Anonymous on October 29, 2011 7:19 AM writes...

Can someone put some actual numbers to these "reports" and where possible, tie those numbers to specific research sites?

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26. seen2much on October 29, 2011 7:30 AM writes...

Here's the "beauty" of it all (from a 20+ yr vet of MRL). Do excuse my frustration:

1. Merck used to be a leader in the Pharma industry, which is why I joined. Now we are merely followers, and late to the party at that (evidence: SP merger. P.S. - I have no issues with the many talented scientist I've encountered from legacy SP).
2. Merck hubris, while legendary in the 1990's ("America's Most Admired", after all!!!) has, despite the devastating decline Merck has experienced since then, only grown.
3. R+D "bench-level" talent, once celebrated, serves only as a bullseye for HR to shoot at. "What, you made a Drug??? So what!! We need to eliminate your position for "business reasons." .....What business? Aren't we supposed to make drugs?
4. Six rounds of major layoffs in R+D and still not done??? Do explain.
5. "Early pipeline, what early pipeline? You mean we need that? For next year? Well then, get right on that. What? Everyone left in your area is working on "advanced" programs? No problem, they can can do both!!!!! And don't forget to keep it simple since we'll be outsourcing it once validated!"
6. Hurry up and get those protocols written-up so we can outsource your position once you're done. We have headcount "goals" to meet.
7. "We know you just moved from Dept. A to B a year ago, but we want to back in B" (until next year when you can go back to Dept A). Moving your lab, without help, won't take more than a couple of hours, will it? You do have deadlines you know. Here are your boxes."
8. Merck enjoyed record revenues this quarter; oh, and we'll be eliminating an additional 13% of our workforce, with a disproportionate number coming from the US.
9. "We know this is hard on our people, but this is for our future!" .....Whose future????
10. "We are in this together"....but I'm going to make 100X more than you this year, because I make all the "hard" decisions (let killing the goose that laid the golden egg)

I could go on, but I lost many excellent colleagues this week and I'm drained to the core....with no end in sight.

Be well.

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27. Outsider's Opinion on October 29, 2011 8:27 AM writes...

I am not from Merck. I wish all the best to Merck-SP employees who were let go.

It is pretty clear to me that, nowadays, Merck does not care too much about his own R&D, science, hard work and being a first-in-class.

This became clear when Merck closed Merck-Frosst, its most productive and hard working site. And further confirmed when they decided to push an inferior me-too drug (Boceprevir) to compete with a gangbuster drug (VRTX's Telaprevir).

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28. LegacyMerckGuy on October 29, 2011 8:31 AM writes...

@22, MF was on the block before Vacca was placed there, that was announced before he moved.
@26, I agree with you 100% that sounds a lot like my Voice of the Scientist survey. Like they even care about that anyway.

IMHO, the biggest problem is with Kim and Tillyer. They both seem to have no clue what they are doing and are scurrying around stuffing millions down places that are not paying off. For example, Tillyer championed an automated ligand screening system (ALIS) and guess what? After a few million invested, it was scrapped. A few million went into the construction of an automated synthesis lab (ASAP), and there are brand new Tecans sitting there gathering dust and they are STILL wanting to expand it. Tillyer actually had the balls to say we were all "sourcable" in a meeting last year. The best expression that I have heard lately is that Merck is the place where there are many people rising but none of them are stars. With these two schmucks running MRL, how can Frazier be expected to make any good informed decisions when all they give him is garbage?

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29. LegacyMerckGuy on October 29, 2011 8:35 AM writes...

I also forgot to mention the billion dollar SiRNA gem provided by Kim.

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30. Sundowner on October 29, 2011 9:51 AM writes...

I had colleagues working in S-P, former Organon, and they were really pessimistic about the future when the M&A process started. They had a good pipeline, they were brilliant... and they were fired. I think that's one of the most stupid things I have seen in the pharma industry in the last five years. You purchase a company because you want the pipeline... and then you fire the people that contributed to the pipeline, making impossible to keep the effort for the future. It is like buying a Ferrari because you need a fast, fancy car, and then scrapping the engine.

To #8. Some years ago my company (a custom synthesis company) worked for Sigma-Aldrich preparing the compounds you see in the catalog. After a time you are sick of seeing how they pay you x dollars/g and they sell the stuff at a price 4 or 5 times higher; when they sucked us our blood, they moved everything to cheaper suppliers in Chindia. So honestly, I do not give a s*** if they lose a big chunk of their business when they have contributed greatly to other companies losing a big chunk of their business.

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31. Anonymous on October 29, 2011 10:23 AM writes...

Joe Vacca is only the executioner! Do not blame him because he is as obedient to his bosses as he is to his wife. Now leave him alone because he is out of a job (with a nice pension and package though) in Nov. Soon he will be the CEO of VaccaConsulting.

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32. Anonymous on October 29, 2011 12:15 PM writes...

@28 you are wrong, Vacca was at MF before the announcement. Famous quote from Joe, when asked what does Interim Site Head mean (that was his title). His response was "At Merck we are all interim." How prophetic.

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33. nonpharma chemist on October 29, 2011 1:03 PM writes...

@30 Sundowner: Please tell me that you weren't synthesizing brownish palladium tetrakis for Sigma-Aldrich. Over the years, I've found that ordering from S-A can be such a crapshoot, especially with all the outsourced manufacturing. On several occasions I've received pristine yet EMPTY bottles of reagents, shipped with vermiculite in a sealed pop-top canister!

Like others above, I wish all of the doomed Merck/Schering-Plough employees the best. Unfortunately, I can't offer another more than my condolences; I'm just hanging on to my job for dear life. Anyway, did the Merck/Schering-Plough REALLY come as a surprise to anyone, considering the trail of death, destruction, and mayhem he left at Sandoz, Wyeth-Ayerst, AND Pharmacia-Upjohn?

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34. Anon on October 29, 2011 1:39 PM writes...

Derek writes:

Experience, past accomplishments, and ability are not very high at all on the list of factors being judged when it comes to this point.

However, they are top on the list for what it takes to be successful in most any scientific field.

To not care about such matters is a sign of a dying company.

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35. Susurrus on October 29, 2011 2:04 PM writes...

Derek, I nominate you to be the leader of the revolution. Be our Che. Start a company - I'll work for peanuts to do good science without the BS.

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36. Susurrus on October 29, 2011 2:16 PM writes...

@35 - myself

without the execution, of course.

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37. Susurrus on October 29, 2011 2:23 PM writes...

Peanutd and an equity stake (Did somebody say Steak?).

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38. Susurrus on October 29, 2011 2:25 PM writes...

Peanuts. Sorry. I was typing and eating a sandwich at the same time.

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39. LegacyMerckGuy on October 29, 2011 3:18 PM writes...

@32 I knew of the intended closure before he was there officially. At the time we had an in vivo assay run there and we were told that it would be closing so we had to adjust. A short while later, Vacca was sent there. You're crazy if you think that he was put there THEN it was decided that it would close. No way. Guys like him don't make calls like that. They come from higher. Like 31 said, he was merely the executioner.

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40. Snowmageddon2011 on October 29, 2011 4:17 PM writes...

39 & 32, your squabbling over petty details doesn't change the fact Merck Frosst (more importantly, its people) were unjustafiably scuttled. Regardless of "who calls the shots" and "who is the executioner", the same wholesale liquidation of scientific talent has been repeated throughout the Western World. Unfortunately, nobody in this country has the cash, charisma, or cajones to become an effective advocate for displaced industrial scientists.
About the only thing we can do is boycott as many of Big Pharma's non-generic products as possible. Since the corporate leviathan eats, breathes, thinks, and craps money, the only way to hurt is by withholding money. Don't waste your time in fantasizing that the CEO's and other Inner-Party members will hear your sob stories.

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41. LegacyMerckGuy on October 29, 2011 8:33 PM writes...

@Snowmageddon2011 I know they don't give a crap about any of us and never said/thought they would hear/care about any complaints/concerns from the "help". The only problem with your idea on how to "hurt" them is only going to accelerate the outsourcing and put us out of work faster. Personally, I totally miss the work we had done there. The biology was awesome, the CRO we use now is awful.

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42. My 0.02 on October 29, 2011 10:13 PM writes...

If "venting your frustration and anger" can make you feel better, by all means, do it. But best "revenge" is to start and grow a company and sell it back to your ex-employer(s) at a huge mark-up.

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43. Jmerckedaround on October 30, 2011 4:23 AM writes...

@ 29
Now, don't get me started. SiRNA was and is one disaster waiting to happen (not withstanding a recent report of ocular toxicity). It seems to me that SiRNA will be snuffed out forever and perhaps Dr. Kim will be taking along with him, once he is shown the door. If you need another glaring example of rewarding the failure and failed one, this is it!

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44. Question to Merck People on October 30, 2011 6:34 AM writes...

How many molecules MRL Boston ever pushed into the clinic?

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45. Anonymous on October 30, 2011 7:24 AM writes...

Repeat question. How many were let go at each site?

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46. Traveller on October 30, 2011 10:55 AM writes...

Growing up in this Industry in the '80's and '90's, Merck were the aspiration and inspiration of us all.
So shocking to be a witness to this.

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47. seen2much on October 30, 2011 11:10 AM writes...

@49. Traveller
Precisely why I joined (indeed Art Patchett was one of my personal scientific heroes). Not too many beating down the doors to join Merck these days....any wonder???

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48. The Blue Maharajah on October 30, 2011 11:39 AM writes...

With you @ 49 Traveller

The fall of Merck R&D does seems like the seventh sign for an Industry whose managers lack any strategy other than to cut, then cut more.

"The job had to be done every day and every day with never a stopping but going on, with never a pause, but always the harvesting, forever and forever and forever."

Ray Bradbury, "The Scythe."



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49. anonny on October 30, 2011 1:38 PM writes...

What always amazes me in discussions on Merck is the dreamy, romanticizing, wishful future as is remembered the past. Not everyone was successful in Merck of the '70s,'80s and '90s. R&D was very competitive, and VERY POLITICAL. Don't try to believe otherwise. Some very good scientists were destroyed there, just as happened at other companies and happens in academia as well.

But even so, it's time to recognize that today's version of Merck is a company that is really not much different than any of the other larger Pharma in the world at large. They face the same challenges in a changing world, across many areas including science, politics, regulatory expectations, safety, costs, legal threats, public perception, providing dividends to the shareholders etc. A culture and company that has 'regressed back to the norm' but spawns in many romantic, whistful memories which simply cannot be satisfied.

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50. @45 on October 30, 2011 4:30 PM writes...

It is unlikely that you will get exact figures here. You may have better luck asking the blogger who runs "A New Merck Revisited". Suffice it to say that within another 2 years, at least 16,000 Merck/Schering-Plough employees from all departments will have been purged. The 16,000 figure was announced shortly after the merger.

Anyway, why do you care so much about specific layoff numbers for each remaining research site? Are you expecting to replace anynone at Merck as a non-outsourced employee? Dream on, noseypants. Start sending your resume to the slavetraders at Aerotek, Covance, & Kelly Scientific.

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51. Anonymous on October 30, 2011 5:28 PM writes...

@50. No need to be such a douche.

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52. Anonymous on October 30, 2011 7:46 PM writes...

@28

RE: "Merck is the place where there are many people rising but none of them are stars".

What you are saying is not new. This is the essence of Roche, Nutley Med. Chem. BIAS including that of the gender variety...

What a mess....strange management handing out RUBBER CHICKENS and demotivating!!! Nonsense and immaturity....

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53. Snowmageddon2011 on October 30, 2011 7:59 PM writes...

I hope that everyone caught in the nor'easter emerged relatively unscathed. As if crappy job prospects for pharma scientists weren't bad enough news, many of those laid-off are stuck residing in high-cost areas with surprisingly inadequate snow removal!

It's depressing to observe the emotional distress caused by a layoff. Aside from the self-doubt ("Could I have done anything to save my job?"), I hate seeing the disintegration of employee solidarity ("Why did they keep him/her instead of me?"). Is there something about the professional scientist occupation that makes it particularly difficult to cope with downsizing? Supposedly thousands have been and will be laid off from the financial and legal industries. Why does it seem like the MBA's and JD's have an "easier" time bouncing back?

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54. another question to merckers and ex-merckers on October 30, 2011 8:22 PM writes...

Now that layoffs are in full force, is Merck finally going to stop spamming the ACS careers website with phantom job postings?

I recently attended a seminar given by a former lab scientist who is now in business developement for a major CRO. The way he nonchalantly described his company's "well-trained resources" and "production factors" reminded me of how easily we can dehumanize each other.

Merck is STILL holding on to siRNA? Are you kidding me? What is the likelihood that the USFDA will approve any pharmaceutical administered by a mixture of nanoparticles or viral capsids?

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55. Anonymous on October 31, 2011 10:43 AM writes...

@33. nonpharma chemist--Please tell me you don't still use Pd tetrakis for cross-coupling chemistry. Do you still use a Bunsen burner for heating your Grignard reactions too...?

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56. Hap on October 31, 2011 11:58 AM writes...

53: If I'm being really cynical, because financial scams are relatively short-lived and so change is inherent in their business model. If I'm being less irritable, the timelines for drug research are long, the investments of the people doing it in their training are significantly greater than either MBA or JD training, and the pay is not high enough to provide a significant measure of security in case of layoff (better than lots of people, but not enough to afford to not work for a while).

As put more cynically/angrily above, the reality of business (particularly new types of business or new businesses) is that nothing endures, so the expectations are very different. Chemists haven't necessary been mistreated more than others, but like lots of people with pensions, people feel like they were sold a bill of goods that those selling it had no intention of actually delivering. I don't know how many more times people are going to be willing to invest in careers when it seems like the opportunity to play as Charlie Brown in a football game with Lucy is all it gets them.

In addition, (WAG) even though science does require transferable skills to perform well, people are generally regarded for their specific technical skills and not for their intellectual skills - thus a JD or an MBA might more easily switch fields than lots of science people.

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57. nonpharma chemist on October 31, 2011 3:21 PM writes...

@55 Anon: Actually using tetrakis as a pre-catalyst. No, I'm not flame-heating my Grignards, but I'll still stand by flame-dried glassware under high-vac in preparation for anhydrous reactions! :)

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58. Anonymous on November 1, 2011 12:04 PM writes...

Hey Pd-snobs @55 and @57. What are you guys using that's so much better?

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59. Nile on November 1, 2011 5:10 PM writes...

Someone's got to ask...

What's the minimum viable population of working chemists, pharmacologists, and clinical researchers, required for a self-sustaining pharma industry?

Any fool can build a 'research campus' in a third-world country, recruit educated-looking locals, and parachute in a core of hoary old veterans from proven and productive labs in America and Europe... But do these ventures ever really succeed? Most will never replicate the glory days of a Merck, or a Glaxo, or an SP; most will lose whatever creative momentum they had, and become offshore testing centres; most - or all - of the few that become genuinely productive centres of discovery and development will be dependent on a continual top-up of foreign-trained personnel, as they are not a large enough community to train up successive generations of new staff - at all levels - and they don't exist in a larger community of industrial and research chemistry companies that would collectively sustain the 'critical mass'.

So far, so trite... But where's the point at which the USA looks like a foreign country, a base for 'offshore' research centres that depend on a core of expats, because there's no indiginously self-sustaining community of chemists?

Go on: put a number on it. Ten thousand docs? A hundred? Three and a bottle-washer?

Ten thousand graduates and senior technicians, and two thousand doctorally-qualified senior researchers?

Plot a graph of job losses: it's accelerating. You can say "This can't go on", but it's been going on for a decade and it shows no sign of stopping: I think the United Kingdom has now fallen below that 'ten thousand plus two thousand' population, but I don't know whether that's a viable community or not. It is, in short, wild guesswork.

So go on: place your own guesses.

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60. LegacyMerckGuy on November 1, 2011 8:12 PM writes...

@ 58: Ignore them. That is just Buchwald having an episode of boredom.

@54: Yep, SiRNA is still there and it probably will be there as long as Kim is still here. Hopefully he will get canned soon and take Tillyer with him to his new consulting firm.

I know that at Rahway alone, we lost 30, and Kenilworth lost 70. The irony is that just yesterday we had a meeting where someone (who shan't be named) said that basically they want 5 folks on site on each project and the rest are "external partners". Sounds kind of like that thing Pfizer is trying. OH CRAP, we hired the same consultants. (insert William Shatner: KAAAAAAAHHHHHNNNNNNNNN!!!!!!!!!!)

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61. @60 LegacyMerckGuy on November 1, 2011 9:10 PM writes...

Oh no you did NOT just talk smack about The Buchwald! Aromatic Finkelsteins are Da Bomb! Where my phosphine ligands at? Woot, woot! (snap, snap, head swing) (Just kidding.)

Are you describing "internal outsourcing"? I've heard that certain chemical/pharma companies are notorious for laying off experienced researchers and then re-hiring them as contractors at reduced salaries and benefits. As ignominious as that may be, I presume that some of your former colleagues would have little choice but to accept contractor work. Is New Jersey doing much to help displaced scientists? Can't the NJ townships at least lower your property taxes?

Does "external partners" refer to those shady CRO sweatshops that import H1-Bs by the truckload? WTH is the management thinking?!

Funny but sad...I remember that during an interview in Kenilworth, the HR rep was just beaming about the inspirational leadership of Fred Hassan and the executive board. The scientists were all smiles about the record sales of Zetia and Vytorin. I didn't end up getting the job...I was disappointed but in retrospect it was a good thing. Anyway, thanks for providing us an inside scoop on the debacle unfolding at Merck. I hope that mid-progress PhD candidates take heed of these warnings and pursue alternate careers. It's not too late for them!

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62. Anonymous on November 2, 2011 6:41 AM writes...

We need a Chemistry Guild. Not a union, but a guild.

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63. Susurrus on November 2, 2011 7:04 AM writes...

@62: Agreed. Something like Pratchett's Guild of Assasins on the DiscWorld.

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64. Nick K on November 2, 2011 1:09 PM writes...

#59 Nile: Thanks for this. I too have been wondering about how far the downsizing process can go before the drug discovery process simply comes to a halt through lack of trained people. Has anyone collated the data for total pharma R&D employment as a function of time and geography? Perhaps the indefatigable Chemjobber could look into it.

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65. Anonymous on November 2, 2011 3:42 PM writes...

@60 & 61

I think the "external partners" they are referring to are likely CRO's in China and India. Wuxi and the like...

More jobs going oversees!!! When will this crap stop???

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66. @62 & 63 on November 2, 2011 10:41 PM writes...

How about "Colonial Space Chemists"? "Insane Chemist Posse"? "The Bond Forgers"? Nah...

I don't know about guilds, but there sure were many factions back in grad school, like in the "Total War" series!

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67. Anonymous on November 2, 2011 10:56 PM writes...

@61 said "Are you describing "internal outsourcing"? I've heard that certain chemical/pharma companies are notorious for laying off experienced researchers and then re-hiring them as contractors at reduced salaries and benefits. As ignominious as that may be, I presume that some of your former colleagues would have little choice but to accept contractor work."

During the wave in which I was let go, a memo was circulated afterwards explicitly stating that no one let go during that wave was allowed to be considered for the contractor positions which were going to be pharmed out to Kelly Scientific and Aerotek. Those positions also carried the (0-5 years experience required) label which basically disqualified 90% of those "more experienced" scientists who were let go anyway. In light of that, I didn't see why it was necessary to add salt to the fresh wounds by stating that the recently laid off need not apply.

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68. Anonymous on November 3, 2011 5:43 AM writes...

@60.

Ouch! -30 versus -70. Does that mean that the term "reverse merger" is no longer being used in press releases?

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69. LegacyMerckGuy on November 3, 2011 4:16 PM writes...

@61: You bet I mean CRO's. We have been slowly doing it for smaller things (i.e. Pan Labs) but now all of our Global Counter Screens and PK are off site. And that is only what I know of. I'm sure that is only the tip of the iceberg. Some of out in vivo studies are in company but I bet that is likely to change. And we can't refer to them anymore as an "outsourcing" entity either. The new catch phrase is "external partner". I'm sure that their ultimate "vision" is for the internal to stop at the director level and everything else done outside. Tillyer even said in an email a few days after the layoffs (oh...I'm sorry, the "notifications") that basically this wasn't over yet and he used the "innovation" garbage like he actually had a clue of what that is. He can't even wait for the band-aids to cover the wounds before he throws salt in it. It almost seems that he likes it. Oh wait, he gets stock as well as cash for a bonus. No wonder he can't wait to "streamline" the company.

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70. Anonymous on November 3, 2011 8:40 PM writes...

Tillyer is a scrooge! The only thing he knows well is to cut!

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71. @69 LegacyMerckGuy on November 3, 2011 9:09 PM writes...

"External partnering"? Merck and the rest of the industry have certainly become euphemism-friendly! I'm nauseated by terms such as "refocused priorities", "strategic alliances", "career transition events", and "human-caused disasters".

Something about having your in vitro and in vivo "externally partnered" seems shady when you have capable scientists and facilities at hand in Rahway and Kenilworth. Anyway, good luck to you and whoever's left a Merck as a "permanent" employee. Perhaps you should get PMP training or some Six-Sigma Black Belt certification to improve your chances of surviving the next pogrom.

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72. Anonymous on November 4, 2011 7:00 PM writes...

Pogrom is exactly the right word...

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