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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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« One. . .Million. . .Pounds (For a New Antibiotic?) | Main | Aggravating Aggregators »

June 14, 2013

Making Changes Inside Merck's R&D

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Posted by Derek

I've heard from more than one source that Roger Perlmutter has been shaking things up this week at Merck. Since he only took over R&D in March, that's a pretty short lag time - if these reports are accurate, he clearly has some strong opinions and is ready to act on them. From what I've been hearing, bench-level people aren't being affected. It's all in the managerial levels. Anyone with more knowledge and a willingness to share it is welcome to do so in the comments. . .

Comments (115) + TrackBacks (0) | Category: Current Events


COMMENTS

1. PharmaHeretic on June 14, 2013 9:24 AM writes...

So the new CEO is rearranging deck chairs on the Titanic, or maybe the Hindenburg. The real question is.. Does any of this matter at this rather late stage?

Permalink to Comment

2. anon 8 on June 14, 2013 9:36 AM writes...

"..From what I've been hearing, bench-level people aren't being affected." Are we sure about that? I mean is there any more bench chemists left? I thought all those were slowly and steadily were shipped to China with stealth! The bench level people are not affect and that is because there is none.

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3. Anonymous on June 14, 2013 10:11 AM writes...

Research Leadership Team (RLT)

Rupert Vessey will lead Discovery and Early Development.

Rich Tillyer will have responsibility for Preclinical Development, including process chemistry.
Linda Schaffer will lead Project Management group, and will have responsibility for all performance metrics.
Barry Gertz will head the Clinical Development organization, including clinical operations, the clinical therapeutic areas, and the Japan development organization,
Dennis Erb will be responsible for our Regulatory Affairs and Safety organization, which will be expanded to include our emerging market activities,
Rich Murray will lead research in Biologics and Vaccines, including process development activities necessary to provide materials for clinical trials and the transfer of commercially viable manufacturing processes to MMD,

Licensing organization will report directly to Roger Perlmutter. An external search for a new head of licensing is underway Roger Pomerantz is gone.

All senior management roles associated explicitly with franchise governance (Franchise Heads and Franchise Worldwide Discovery Heads) have been eliminated, and the people have been let go.

All site heads have been let go.

Blood bath at the managerial levels of MRL.

Rumor has it that Roger said that the dysfunction was beyond belief, and not the fault of the scientists.

Permalink to Comment

4. anon on June 14, 2013 10:31 AM writes...

The culture of self preservation has deprived the scientific community at Merck over the last 15 years.

When PK took over from Roger, we heard the same BS. there was rearrangement and re-alignment based on who kissed PKs ass the best.

Now Roger takes over from PK and the race to self-preservation is on. Given the stiff competition to Kiss rogers ass - I am not surprised it took him time to bring about changes.

same old shit will continue. I lament our fate as drug discovery scientists.

Permalink to Comment

5. Chrispy on June 14, 2013 12:11 PM writes...

Better through subtraction -- this is becoming a common theme in this industry. Imagine the amount of talent and experience that was just shown the door... Really, in the balance it is hard to imagine that this is a path to being less dysfunctional.

Permalink to Comment

6. Nathaniel on June 14, 2013 12:21 PM writes...

Cosmetic changes. Franchise heads had redundant role anyway.


Permalink to Comment

7. Nathaniel on June 14, 2013 12:22 PM writes...

Cosmetic changes. Franchise heads had redundant role anyway.


Permalink to Comment

8. Anonymous on June 14, 2013 12:32 PM writes...

What's absolutely fascinating is that while they claim they want to focus energy on vaccine development they have let go of a couple of senior people who were arguably the strongest part of the vaccine team - Jeffrey Silber (who was Therapeutic Area head for Vaccine Clinical Research, and an ID specialist by training)has been replaced by Jeff Chodakewitz - whose upper level sr. vp position was eliminated - returning him to a role he held 8-10 years ago. And Keith Chirgwin, VP, Vaccines pipeline and project leader, has been removed, and replaced by someone with far less vaccine experience.

Permalink to Comment

9. Anonymous on June 14, 2013 12:50 PM writes...

What about Alise leading oncology - apparently she finally cracked at her most recent deposition, when her duplicity was clearly exposed.

Permalink to Comment

10. Bernard Munos on June 14, 2013 1:00 PM writes...

"Roger said that the dysfunction was beyond belief, and not the fault of the scientists"... Sounds like Lilly.

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11. tweety bird on June 14, 2013 1:29 PM writes...

perlmutter should come to abbvie. same dysfunction here. managers and department heads especially in oncology are morons and don't even know what cancer means. scientists work their ass off, and get sidelined cause no one listens to them. fire the mgmt here too and give the scientists a break - geez they have to do what they're told. mgmt has all the brains..lol

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12. tweety bird on June 14, 2013 1:31 PM writes...

perlmutter should come to abbvie. same dysfunction here. managers and department heads especially in oncology are morons and don't even know what cancer means. scientists work their ass off, and get sidelined cause no one listens to them. fire the mgmt here too and give the scientists a break - geez they have to do what they're told. mgmt has all crap for brains

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13. tweety bird on June 14, 2013 1:33 PM writes...

perlmutter should come to abbvie. same dysfunction here. managers and department heads especially in oncology are morons and don't even know what cancer means. scientists work their ass off, and get sidelined cause no one listens to them. fire the mgmt here too and give the scientists a break - geez they have to do what they're told. mgmt has all crap for brains. bonuses given based on how much money you spent cause it was on your goals. whether it made sense or not, who cares as long as upper mgmt makes bonus.

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14. Anonymous on June 14, 2013 2:07 PM writes...

#8 Yes, vaccines is going to wither and die. Bringing Jeff C. back into vaccines is insane. Letting Keith C. go is also insane- he has more regulatory and institutional knowledge about vaccines than almost anyone on the planet. Rich Murray knows NOTHING about vaccines, a bit more about mAbs, and nothing about good process development. It remains to be seen which of the THREE PD1 mAbs makes it to market. Certainly not the ones with a sloppy process....

The good news for Merck is that John Shiver is going to Sanofi as CSO. That should bog down their vaccine efforts.

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15. anon on June 14, 2013 2:10 PM writes...

From someone who has been at Merck for 15 years. 6 years of layoffs, er excuse me, re-organizations has really put the hurt on those remaining scientists. No one believes that there won't be another round of lay offs, er... re-organizations. I am surprised that anything gets done day to day with this kind of stuff hanging over peoples heads.

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16. Roger Rabbit on June 14, 2013 2:54 PM writes...

This kind of surgery was inevitable, Merck's madness had been steadily getting worse making it impossible for discovery to be effective. Question is how long before the next reshuffle after this one? Such a waste of time, $$ and talent.

Those consultants that convinced us of a franchise structure using Exxon as an example, what a bunch of bozo's.

Permalink to Comment

17. Anonymous on June 14, 2013 3:12 PM writes...

The huge irony here is that Merck has been degenerating for years with the Vioxx debacle being the turning point and Roger was intimately involved in the deranged reasoning post VIGOR that led to the humiliating catastrophe. He actually hired the architect of the entire mess at Amgen - Beth Seidenberg - and subsequently fired her.

At Amgen, Roger surfed the wave of revenue from Amgen's old products without providing any evidence of actual proficiency. He is articulate, smart and wealthy but devoid of noteworthy concrete accomplishments.

Permalink to Comment

18. Anonymous on June 14, 2013 3:13 PM writes...

It looks like Merck is serious this time.

Subject: FW: Merck in the News
MERCK TO CUT WORKFORCE 120 PERCENT

NEW YORK, N.Y. (AP.com) - Merck will reduce its workforce by an
unprecedented 120 percent by the end of 2013, believed to be the first
time a major corporation has laid off more employees than it actually
has.
Merck stock soared more than 12 points on the news.

The reduction decision, announced Wednesday, came after a year-long
internal review of cost-cutting procedures. The initial report concluded
the company would save $1.2 billion by eliminating 20 percent of its
85,000 employees.

From there, said a spokesperson, "it didn't take a genius to figure out
that if we cut 40 percent of our workforce, we'd save $2.4 billion, and
if we cut 100 percent of our workforce, we'd save $6 billion. But then
we thought, why stop there? Let's cut another 20 percent and save $7
billion.

"We believe in increasing shareholder value, and we believe that by
decreasing expenditures, we enhance our competitive cost position and
our bottom line," he added.

Merck plans to achieve the 100 percent internal reduction through
layoffs, attrition and early retirement packages. To achieve the 20
percent in external reductions, the company plans to involuntarily
downsize 17,000 non-Merck employees who presently work for other
companies.

"We pretty much picked them out of a hat,".

Among firms Merck has picked as "External Reduction Targets," or ERTs,
are Quaker Oats, AMR Corporation, parent of American Airlines, Lockheed,
Boeing, and Charles Schwab & Co. Merck's plan presents a "win-win" for
the company and ERTs, said the Merck spokesperson, as any savings by ERTs would be passed on to Merck, while the ERTs themselves would benefit by the increase in
stock price that usually accompanies personnel cutback announcements.

"We're also hoping that since, over the years, we've been really helpful
to a lot of companies, they'll do this for us kind of as a favor,".

Legally, pink slips sent out by Merck would have no standing at ERTs
unless those companies agreed. While executives at ERTs declined to
comment, employees at those companies said they were not inclined to
cooperate.

"This is ridiculous. I don't work for Merck. They can't fire me," said
Kaili Blackburn, a flight attendant with American Airlines.

Reactions like that, replied the Merck spokesperson "are not very
sporting."

Inspiration for Merck's plan came from previous cutback initiatives,
said company officials. In January of 2005, for instance, the company
announced it would trim 15,000 jobs over two years. However, just a year
later, Merck said it had already reached its quota. "We were quite
surprised at the number of employees willing to leave Merck in such a
hurry, and we decided to build on that,".

Analysts credited the short-term vision, noting that the announcement
had the desired effect of immediately increasing Merck's share value.
However, the long-term ramifications could be detrimental, said Morgan Stanley analyst Beldon McInty.

"It's a little early to tell, but by eliminating all its employees,
Merck may jeopardize its market position and could, at least
theoretically, cease to exist," said McInty.

The spokesperson, however, urged patience: "To my knowledge, this hasn't
been done before, so let's just wait and see what happens."

Permalink to Comment

19. Anonymous24 on June 14, 2013 3:14 PM writes...

It looks like Merck is serious this time.

Subject: FW: Merck in the News
MERCK TO CUT WORKFORCE 120 PERCENT

NEW YORK, N.Y. (AP.com) - Merck will reduce its workforce by an
unprecedented 120 percent by the end of 2013, believed to be the first
time a major corporation has laid off more employees than it actually
has.
Merck stock soared more than 12 points on the news.

The reduction decision, announced Wednesday, came after a year-long
internal review of cost-cutting procedures. The initial report concluded
the company would save $1.2 billion by eliminating 20 percent of its
85,000 employees.

From there, said a spokesperson, "it didn't take a genius to figure out
that if we cut 40 percent of our workforce, we'd save $2.4 billion, and
if we cut 100 percent of our workforce, we'd save $6 billion. But then
we thought, why stop there? Let's cut another 20 percent and save $7
billion.

"We believe in increasing shareholder value, and we believe that by
decreasing expenditures, we enhance our competitive cost position and
our bottom line," he added.

Merck plans to achieve the 100 percent internal reduction through
layoffs, attrition and early retirement packages. To achieve the 20
percent in external reductions, the company plans to involuntarily
downsize 17,000 non-Merck employees who presently work for other
companies.

"We pretty much picked them out of a hat,".

Among firms Merck has picked as "External Reduction Targets," or ERTs,
are Quaker Oats, AMR Corporation, parent of American Airlines, Lockheed,
Boeing, and Charles Schwab & Co. Merck's plan presents a "win-win" for
the company and ERTs, said the Merck spokesperson, as any savings by ERTs would be passed on to Merck, while the ERTs themselves would benefit by the increase in
stock price that usually accompanies personnel cutback announcements.

"We're also hoping that since, over the years, we've been really helpful
to a lot of companies, they'll do this for us kind of as a favor,".

Legally, pink slips sent out by Merck would have no standing at ERTs
unless those companies agreed. While executives at ERTs declined to
comment, employees at those companies said they were not inclined to
cooperate.

"This is ridiculous. I don't work for Merck. They can't fire me," said
Kaili Blackburn, a flight attendant with American Airlines.

Reactions like that, replied the Merck spokesperson "are not very
sporting."

Inspiration for Merck's plan came from previous cutback initiatives,
said company officials. In January of 2005, for instance, the company
announced it would trim 15,000 jobs over two years. However, just a year
later, Merck said it had already reached its quota. "We were quite
surprised at the number of employees willing to leave Merck in such a
hurry, and we decided to build on that,".

Analysts credited the short-term vision, noting that the announcement
had the desired effect of immediately increasing Merck's share value.
However, the long-term ramifications could be detrimental, said Morgan Stanley analyst Beldon McInty.

"It's a little early to tell, but by eliminating all its employees,
Merck may jeopardize its market position and could, at least
theoretically, cease to exist," said McInty.

The spokesperson, however, urged patience: "To my knowledge, this hasn't
been done before, so let's just wait and see what happens."

Permalink to Comment

20. Teddy Z on June 14, 2013 3:50 PM writes...

#18 (and I guess #19) I am glad I wasn't drinking when I read that. Genius. As a former Merck employee, I was not impressed with Rich Murray when I reported to him. I am less impressed with him now that I don't report to him.

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21. Anonymous on June 14, 2013 4:09 PM writes...

@17_ I was there at Amgen when he brought in Beth, brought in Sean, Joe, Paul and others to lead critical functions. While he is those things you say, especially the wealthy part, clearly he has no aptitude for recognizing who is fit to lead an organization. Though I do not know how bad it was at Merck, and perhaps he made some good choices, what I saw was an absolute disaster in fixing bad organizations coupled with an ability to destroy good ones fueled by the worst judge of character imaginable. Good luck at Merck!

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22. gazette on June 14, 2013 4:33 PM writes...

#3

"All site heads have been let go". Who is steering the ship at Rahway?

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23. Esteban on June 14, 2013 4:36 PM writes...

@10: Ha! Spoken like an ex-Lillyputian which I know you to be...but then so am I and I happen to agree! :)

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24. Anonymous on June 14, 2013 4:38 PM writes...

@21 - like most senior executives Roger likes and promotes those who worship him.

He had no insight whatsoever into the clusterf**k that Beth engineered and her decisive ineptitude as illustrated below! Amgen HR compelled him to fire her subsequently.

From the classic announcement of Beth's hire at Amgen in 2002 as an illustration of flawed judgement:-

"We are extremely pleased that Beth Seidenberg, a globally recognized expert in immunology and inflammation, has decided to join the Amgen team. Beth has demonstrated her talent in moving drug candidates with speed and care through the development process, both at Merck and Bristol-Myers Squibb. She is a real leader in clinical research," said Dr. Perlmutter. Dr. Seidenberg's career milestones the development and approval of VIOXX(R) for pain management. She is credited with decisive, effective leadership in bringing both these products to successful approval.

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25. Chemjobber on June 14, 2013 4:40 PM writes...

18/19: I bow to your superior skills.

Permalink to Comment

26. srp on June 14, 2013 8:08 PM writes...

An experiment I'd like to see: A drug company led by managers elected by the research staff. Judging from the commenters on posts like these, something high-variance and informative should happen.

Permalink to Comment

27. anonymous on June 14, 2013 9:04 PM writes...

(Ad hominem comment redacted - DBL)

Permalink to Comment

28. anonymous on June 14, 2013 9:05 PM writes...

(Ad hominem post redacted - DBL)

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29. Charles Darwin on June 14, 2013 9:17 PM writes...

The leadership selection filter is for political self promoters rather than for those skilled in decision making.

Insecure incompetents promote their like - their insecurity explains the fetish for outside consultants.

Clueless - lets hire BCG or McKinsey!

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30. Anonymous on June 14, 2013 9:56 PM writes...

19 (20). time to change job and become a journalist. It is much easier to make up news than compounds.

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31. Zippy on June 14, 2013 10:21 PM writes...

This cannot be surprising to anyone at Merck before PK arrived that knows the current state.

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32. Biff on June 14, 2013 10:24 PM writes...

@18 + @19 -- This was funny the first time I saw it, with American Airlines as the company.

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33. Anonymous on June 14, 2013 11:41 PM writes...

@18 & 19: I thought you were going to say the extra 20% was coming from Merck KGaA because the people at the top did know the difference.

Permalink to Comment

34. Anonymous on June 14, 2013 11:45 PM writes...

@18 & 19: I thought you were going to say the extra 20% was coming from Merck KGaA because the people at the top didn't know the difference. Ooops!

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35. Anonymous on June 15, 2013 5:39 AM writes...

Rupert V is slime. He had to leave Merck Clin Pharm in Blue Bell eleven years ago for sleeping with the married help. He dumped his wife and dashed out the door with his helper before HR could eject him and her...anyone remember that fine leadership example ?

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36. anonymous on June 15, 2013 7:18 AM writes...

Some former site heads like Erion and Hunter reassigned, not let go.. New silos created, and MRL culture will persist. Nobody publicly admiting how much of a debacle the reverse merger was. They bought an oversold pipeline and staff.

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37. Anonymous on June 15, 2013 7:19 AM writes...

Roger may be new to the current job, but he is now new to the company. He probably watched afar all these years at MRL and clowns like Peter Kim and Kathleen Metters, and knew what was going wrong. One thing he is doing right is to get rid of the franchises, which do nothing other than creating silos. As for the individuals he retained or promoted, the major criteria is not different from Peter Kim. The big ass kissers who did not have past issues with him wins, whereas those who were get rid of were done for revenge, most likely.

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38. Anonymous on June 15, 2013 8:51 AM writes...

#37 - precisely.

Most beguiling ass kisser - Alise.

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39. Frossted on June 15, 2013 9:49 AM writes...

So what's up with the Boston site? No site head, no Oncology lead. Is Perlmutter going to take down the Scolnick Shrine as a final act of revenge?

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40. Anonymous on June 15, 2013 10:13 AM writes...

Revenge - what a motivator - one rarely sees such an unvarnished example.

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41. Anonymous on June 15, 2013 10:25 AM writes...

Revenge - what a motivator - one rarely sees such an unvarnished example.

For macabre hilarity, surprising that Roger didn't replace Gertz with Beth Seidenberg!

When Reynold Spector resigned in June 1999, Gertz edged Beth to succeed him as head of Clinical Sciences. Beth was going to stay around long enough to get the accolades for a successful GI outcomes study (VIGOR) for VIOXX. However, the questions from the DSMB alerted her to the problematic VIGOR outcome, so she abruptly quit in Feb 2000 prior to the end of the study leaving her protege Alise to rise to stardom with her unlikely, but commercially convenient, explanations that were later proven to be wrong.

Quite a story!


Permalink to Comment

42. anonymous on June 15, 2013 10:29 AM writes...

Rumor has it that ~15--20% additional headcount reductions before all is said and done, including MRL "bench level" scientists. Can anyone confirm or deny?

Permalink to Comment

43. Anonymous on June 15, 2013 11:49 AM writes...

The next CEO may bring Peter Kim back because he is much younger than Roger even though he had to retire first, and did such a good job spending Merck's money on things like SIRNA and Lycera.

Permalink to Comment

44. anchor on June 15, 2013 1:53 PM writes...

@ 43 What will become of the grandiose plan that Merck floated with Lycera? The bitch KM screwed up Merck sites at both Montreal and Rahway along with her British mates and as if that was not enough she became CEO @ Lycera and got Merck to sign the accord! Inflammation is an interesting area that Merck got burned many times over. Do you think Roger will pull the plug on her (he never liked her!) and Lycers?

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45. Anonymous on June 15, 2013 2:23 PM writes...

KM was the protege of Tony FH. That guy has so much to answer for!

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46. anon2 on June 15, 2013 2:45 PM writes...

Merck has certainly made some bad deals, but GSK beats by a large distance. And management still insists that external scientists & academics know more than those inside the company. At the rate they people are "leaving for personal reasons" or "to pursue other insterests", GSK management is making their personal feeling of poor valuation of internal staff coming to fruition.

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47. Anonymous on June 15, 2013 3:48 PM writes...

@44- or what about Calibr with SHultz in California? This was another one of Peter Kim's pet project, will be interesting to see if Perlmutter stays committed.

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48. Anonymous on June 15, 2013 4:24 PM writes...

I was so happy to leave when they opex'ed me and gave me a package. I liked many people there I worked with. Unfortunately, most of them had to leave the company for lack of leadership. What was left of Merck after that is all leadership, politics and no science. I am glad that the MF mafia was finally removed. But the British clowns at Merck are no better. Guess that it takes another CEO to remove them.

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49. Anonymous on June 15, 2013 4:30 PM writes...

#46 "And management still insists that external scientists & academics know more than those inside the company."

It must insist this because insiders know that management are politicians whose primary goal and skill is self preservation and promotion.

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50. anchor on June 15, 2013 5:00 PM writes...

@ 47 Our "dear leader" Dr. Peter Kim was one man wrecking crew! He never knew how good he was at that. My umbrage is reserved for the current managers at the top who went along with his reckless scientific decisions and no one had a balls to stop him. I am sure that PK must be having his last laugh walking out with all those $$$ in addition to funneling some of it to his friend Schultz! Merck will continue to bleed as far as my eye can see. The competition in any therapeutic was tough then and is brutal these days. Other day I read a news that Abbott (Abbvie) proudly claimed that its cocktail for Hep c medication will be much better than Gilead. Can Merck say the same in any given area? I doubt it! With all those clowns at the top they must pay the price. Of course Roger is making his move and we need to give some time before we start to measure the metrics. But, he does not have the luxury that PK had.

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51. Roy Vagelos on June 15, 2013 5:24 PM writes...

Obviously bringing Beth Seidenberg and Kathy What'her name back is the only way to save this MoFo

Permalink to Comment

52. anon on June 15, 2013 7:07 PM writes...

No 48. Who are the British clowns left at Merck? I thought we'd all gone long ago.

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53. anonymous on June 15, 2013 8:40 PM writes...

Roger is in a no lose situation - if he can't stabilize the ship then he already has Plan B poised - a merger with Amgen. There is no obvious R&D head successor at Merck but there is at Amgen!

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54. Rupert on June 15, 2013 9:14 PM writes...

@ 48 There is me, Rupert the stainless.

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55. Anonymous on June 15, 2013 9:22 PM writes...

I worked for Kathleen Metters as a student. Sorry to see she's risen so far beyond her abilities. Also had the misfortune to work 'with' Rich Murray. Charm without substance is a dangerous thing.

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56. Anonymous on June 15, 2013 9:57 PM writes...

when did you work with KM as a student? Was she a good mentor?

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57. anonymous on June 16, 2013 8:27 AM writes...

Turner, Gertz, Tony FH all are more culpable that Peter Kim - Kim came without any knowledge of drug discovery/development and they didn't correct the situation which says a lot about them!

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58. Anonymous on June 16, 2013 8:59 AM writes...

The Merck Frosst Dream Team

KM - get rid of all experienced scientists when heading MRL
DN - accomplished nothing execpt for such high ranking publications with questionable data (eg, the nature paper). MF Ladies' man!!!
GO - always smiling and kissing asses. Completely ruined the morale in MRL Boston
NK and DS - competing for head of in vivo pharmacology despite lacking expertise and skills
SR -putting NO on all existing drugs as new antihypertensives to align herself with PK's BE SMART compaign.

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59. Anonymous on June 16, 2013 9:20 AM writes...

oh do not forgot RF - the arrogant medicinal chemist who would step on you if you said or did anything that he didn't like.

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60. Anon on June 16, 2013 5:52 PM writes...

@14 "The good news for Merck is that John Shiver is going to Sanofi as CSO. That should bog down their vaccine efforts."

That is so true. Shiver was a mole for Peter Kim and facilitated the demise of too many good people. I feel bad about the resources he will waste at Sanofi. Shame on him.

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61. When will they learn on June 16, 2013 5:57 PM writes...

When will they learn? The demise of Pharmaceutical R&D seems to correlate with bringing big name academics in to do jobs they are not qualified for!

If this was a professional sports team the manager would have been sacked long before all the players!

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62. Anonymous on June 17, 2013 6:30 AM writes...

@61 So true. It used to be that the next wave of senor leadership had earned their stripes with the company by working their way up through the ranks, and hence actually knew some drug discovery coming in. But Merck is not alone in wrecking their programs via big name academics. NIBR within Novartis is certainly another shining example- they relocated the ID department from Boston to California just to hire an academic to head the department, who was an old friend of NIBR research head fishmans from med school. Although I am on the outside, its hard to imagine anyone is worth that kind of disruption to a program.

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63. MTK on June 17, 2013 7:41 AM writes...

62 comments.

Every single one of them bitching, moaning, or fingerpointing.

Not a single one with a suggestion or proposal on how to make things better.

I'll give #46 credit, however, for taking 45 previous shots at MRL management as an opening to take a shot at GSK management.

And no. I'm not part of management, nor an employee, of either company.

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64. Anonymous on June 17, 2013 7:57 AM writes...

#58. can't follow all the comments.
who are NK, NO, and SR? try to make sure to avoid those people in the future.

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65. Hap on June 17, 2013 8:00 AM writes...

If management at either (any) company had wanted constructive solutions to their problems, my guess is that they shouldn't have laid off people who didn't toe their lines. Instead, you get people who complain in private or anonymously because complaining to someone who could do something constructive will get you (and perhaps them, if they actually decided to act) fired. Bitching is certainly easier than doing something, so it is an expected default position; however, making it the only position that doesn't require a suspension of logic, sanity, or self-preservation must have taken some (self-destructive) effort.

This message brought to you by "yougetwhatyoupayfor.com".

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66. overthetop on June 17, 2013 8:15 AM writes...

As an ex-GSK'er who left on my own accord to "pursue other interests", it appears that Merck's motto is the same as GSK's:

"The beatings will continue until morale improves"

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67. Cersei on June 17, 2013 9:21 AM writes...

As an outsider, I was always under the impression that Merck Frosst was one of the more productive research site in not just Merck, but the whole pharmaceutical industry. However from the comments above, it would appear that the "top management talents" identified at Merck Frosst, who were then moved to the rest of the MRL after the closure of the MF site, have all failed miserably south of the border. My question is, are these the faults of MF management team (i.e. they were never very good in the first place, but the bench scientists at Merck Frosst were much better at compensating for the management's weakness) or the MRL site their relocated to (i.e. the MF management was good, but the new MRL site refused to embrace these new people). Does good worker trump bad management, or does bad worker trump good management?

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68. Anonymous on June 17, 2013 10:01 AM writes...

@MTK- disagree with your assessment. One needs only to read the comments carefully to see what people bemoan illustrates the solution. Comments 26 and 27 point to solutions, leaders selected by the ranks and leaders who can make good decisions rather than survive through skillful self promotion. Many other commenters hit on these same themes, adding the folly of hiring top academics (skillful self promoters), promoting yes-men to leadership positions and valuing sketchy science from the outside over the quality work of your own research teams. In all, yes with some venom, a fair portrait of what ails our industry.

@53. Who the hell do you think is an R&D head successor at Amgen? Can't what to hear this one.

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69. also not employed by any company discussed on June 17, 2013 10:57 AM writes...

@MTK: thank you.

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70. MTK on June 17, 2013 11:06 AM writes...

@68,

I'll give you srp's comment #26.

As for the rest, I still consider it mostly venomous Monday morning QBing.

I understand the frustration and bitterness. I empathize with those who feel like they've been maltreated (if that's a word). I'm just saying it gets old. There comes a point when the points been made.

If you've moved on with your life then let it go. If not, well...I'm not sure what to say.

I guess the onus is on me not to read the comments when I have a good idea of what it will generally be.

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71. anonymous on June 17, 2013 11:12 AM writes...

#44- "or what about Calibr with SHultz in California? This was another one of Peter Kim's pet project, will be interesting to see if Perlmutter stays committed."

Let's not forget Peter Kim's other purchase fiascos:

Rosetta, $620 million in 2001.
Sirna, $1.1 billion in 2006.
Glycofi, $400 million in 2006.
Abmaxis, $80 million in 2006.

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72. Anonymous on June 17, 2013 12:00 PM writes...

@ 71- Neither PK nor Merck board showed accountability for his extravagance! The man was very generous with others money. Where is he anyway? Not that he needed the job right away.

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73. KGB on June 17, 2013 12:22 PM writes...

@MTK: I think you hit the nail on the head, but hit it a little too hard. But to be fair, has ANYONE ever performed satisfactorily as head of research at a company this large? What #55 said about KMetters could probably be applied to most of these guys, especially the academics -- "sorry to see them rise so far beyond their abilities." It seems no one is without mistakes, enemies, and disproportionate successes that occur within one's tenure are called flukes. Not defending these guys one bit, I think shake-ups like the one ongoing at Merck right now are a tremendous waste of time and resources with no net gain -- but is this just a broken system? My opinion: drop R&D from big pharma entirely. Salvage talent and infrastructure by exploding existing resources into biotech-like divisions or contract research organizations, each with independent scientific leadership and business metrics but heavily interconnected with the parent pharma, whose licensing, clinical, and marketing functions remain intact. Unlike these three functions, R&D cannot thrive in an environment that relies on politics and optics. So many talented scientists at Merck from the bench up to mid management -- not doing real research because the incentives are so screwed. Meanwhile, biotechs (at least those with secure finding) make all the real breakthroughs.

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74. Anonymous on June 17, 2013 12:34 PM writes...

@67
A bit of both. Science was driven by bench scientist and group leaders, not higher management. Also, the best top managers MF had were fired in 2004-2005 for Vioxx (eventhough the "mistake", if there was one, was to pull the drug (thanks Peter Kim). The risk were so low I don't think it could be seen in pre-clinical, to fire the Bobs was a huge mistake...(Zamboni and Young).

The ones that really went high were the best politicians, not the best managers/scientists.

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75. Anonymous on June 17, 2013 12:54 PM writes...

Probably what's coming next is the merging of cardiovascular and diabetes therapeutic areas and some more headcount reduction.

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76. Anonymous on June 17, 2013 12:59 PM writes...

Perhaps we should have a memorial service for the careers of the upper managers who were sacrificed for the malfeasance and incapacities of their employees; getting kicked onto the street with minimal severances and being unemployable in their fields despite their years of experience has got to be painful.

Oh, wait, that never happened. Oops.

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77. anon2 on June 17, 2013 1:01 PM writes...

Not at Merck, but know some of those who have been appointed to Sr. positions, and they actually are quite good. They will do well for themselves & for Merck in the new age of Pharma.

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78. ExMRL on June 17, 2013 5:43 PM writes...

Get rid of every single "scientist" hired or promoted to an Assistant Director or Director level within the last 5 years. Any ex-MRL knows the culture of cronyism and self promotion has rotted that institution to the core.

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79. Anonymous on June 17, 2013 5:55 PM writes...

what is with all the directors at MRL? Overnight so many people became directors.

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80. Anonymous on June 17, 2013 6:30 PM writes...

@68. Who the hell do you think is an R&D head successor at Amgen? Can't what to hear this one.

Sean H - current head of Amgen R&D - who surfed to stardom on the Vioxx gravy train at Merck and then followed Beth and Roger west. Roger was canned at Amgen because he resisted R&D cuts which were deemed essential to boost stock price which had been flat for a decade. Sean was a known entity, who unlike Roger would eagerly carry out whatever measures the Board and CEO requested, so that he could enjoy the status perks such as the jet. What kind of wuss would challenge R&D cuts for that?

No research pedigree, most publications are vioxx related, but very talkative and Roger really likes/trusts him.

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81. Anonymous on June 17, 2013 6:37 PM writes...

78/79: True. The new directors are directing what exactly? MF Cosa Nostra is still alive and kicking.

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82. Anonymous on June 17, 2013 6:55 PM writes...

Interesting. I was told all the PhDs from MF are directors at MRL Boston or Kenilworth except for a few hard working scientists who do not want to play politics.

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83. Sideline Chemist on June 17, 2013 7:46 PM writes...

At least we got off the Pfizer-bashing for a while. Managed to work in the anti-GSK rants but somehow PFE seems to have escaped unscathed...for now.

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84. Sideline Chemist on June 17, 2013 7:57 PM writes...

While the levity is appreciated, the 120% employee layoff story (#18) has been around since at least 2008 and most likely long before then. Thanks to someone over in Chemjobber's comment section for pointing out that the author merely swapped Merck for Pfizer--which was probably swapped for IBM, AT&T, Dell, Digital, etc, etc, etc.

http://www.cafepharma.com/boards/showthread.php?t=267522

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85. darwin on June 17, 2013 8:10 PM writes...

61- the demise of the Pharmaceutical industry was Business-folk taking over scientific run companies to make them operate more profitably. In with aggressive (and deviant) marketing tactics and gimmicks, out with the long-term commitment to innovation and R&D medicine development. Their globalization experiment and various downsizing strategies have created a culture of twitchy scientists more concerned about the stability of their employment than science. And now nobody gives a shit anymore.

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86. Lyle Langley on June 17, 2013 9:21 PM writes...

Well, it has been heading that way for awhile, but In The Pipeline has officially turned into CafePharma. Well done. Everyone bitching about bosses being idiots and everyone on the board is smarter than the rest. All that is lacking is a poll about who's the hottest scientist. Oh for the days when this site was actually interesting...

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87. Anonymous on June 17, 2013 9:24 PM writes...

what is cafepharma?

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88. Anonymous on June 17, 2013 10:41 PM writes...

@80_ Ahhhh, I failed to see the sarcasm, or perspective of a successor in Roger's eyes.

and Lyle, you stoop low to equate this site to Cafepharma. So what if people express real disgust? Having lived through the wrecking of a great company, that offered packages to honorable people with attached lifetime gag orders precisely because of the stupendous and at times criminal behavior, it is surprising that more people who are passionate about what they do for the right reasons do not speak up. An occasional emotional comment thread about the leaders that wreak havoc and then are re-hired to replace another failed leader does not speak about the quality of In the Pipeline, but rather the state of our employment (or lack thereof). Nice you are feeling fine though.

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89. Mr. Fixit on June 18, 2013 9:27 AM writes...

I know I am late to this game, I like to let the comments pile up before I read through. can anyone point to a profitable pharma company where the staff is happy with the management team? What cvan we learn from this?

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90. Ex-MF Chemist on June 18, 2013 9:49 AM writes...

I joined Merck Frosst as a medicinal chemist at the start of 2004. There was fear in the air – the substance P compound has just failed in a Phase III trial and the impending expiration of Merck’s biggest seller at the time, Zocor, was just around the corner – but there was also an unshaken conviction that we can only get out of this by delivering even more high quality PCCs into the clinic. At the time, the organizational structure was organic and conducive to team work. There were no specific “boxes” to fill - people were promoted due to their accomplishments only – and no specific roles to play. My gain does not have to come at your loss; and scientists and managers did whatever it took (including baking API-containing cookies to enable chronic dosing of rabbits) to move the program forward. I remember coming in on weekends and being inveigled, over lunch, by a fellow bench chemist with >20 years of experience, with stories on how they accessed the chiral cyclopropyl sulfur group in Singulair and how they tracked down all the “missing” radio-label in the Cat K compound. I also remember a drug-hunter giant, who was hard on his team (whom he affectionately referred to as “his boys”), but even harder on anyone else who stood in the way of science (he insulated us as much as possible from unproductive tasks and even threatened to succeed our site from MRL if the “bureaucrats” tried to interfere with the science), that led the charge. I felt we were so productive those days. Perhaps I am being naïve, but if Roger can bring those elements back and give some semblance of stability and pride back to the Merck scientists, maybe and just maybe, the pipeline will start to flow again. And no, I am not with Merck anymore.

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91. Hap on June 18, 2013 10:33 AM writes...

It might be easier to start with "At what pharmas or startups are the scientists happy with their work?" since it is probably a shorter list. Of those, you can then weed out the profitable ones (most big pharmas are profitable - it is a matter of whether the profit is sufficient to justify the risk of investors).

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92. Another Ex-MF Chemist on June 18, 2013 12:17 PM writes...

#90..I say, Roger That! I am fantasizing all the above during my stint at Rahway. The culture, am afraid has changed a lot and with no easy or viable therapeutic target of opportunity around the road is not only rough but uphill as well. Best case scenario for Roger before he calls it quits would be somehow to initiate and forge an alliance between Merck and Amgen.

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93. Anonymous on June 18, 2013 1:19 PM writes...

2004 was late to the game. The days when Vagelos ran the company were the ones to remember with pride. Once it was given to a bean counter, it was all downhill.

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94. Happy to have retired when I did on June 18, 2013 4:06 PM writes...

Glad that I was there for the great days of Vagelos and even some of the Scolnick area (although that varied day to day). When will Merck ever learn that NOTHING will be accomplished by continuous organizational changes. What needs to change is the CULTURE of the organization to what it was when science was cutting edge and the organization rose to any challenge. It was a culture of innovation and execution. Regarding vaccines, too bad that Merck management chased out the ones who really delivered results years ago (Emilio, Dorothy and Mike). Losing Keith just adds to the lack of vaccine understanding.

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95. Nik Fisher on June 18, 2013 6:24 PM writes...

94 comments and counting...

As a one-time big pharma insider and now an outsider for 10 years, I wonder if there is not a most unrealistic sense of entitlement and judgmentality (is that a word) plaguing people who have been around this industry for decades. Perhaps all of Big Pharma needs Ctrl+Alt+Del. That being said, where's Roger Perlmutter when Pfizer needs him?

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96. Anonymous on June 18, 2013 6:33 PM writes...

No magic potion for restoring the past. Have to look at the future. It is an industry that will not ever be the same again. I hope that people in management can come here to look at comments and realize how wrong they can be sometimes. Unfortunately, they are just too arrogant to admit something is wrong.
What R&D needs is science not politics, focus not high profile projects, expertise and experience not big academic names, perseverance not short term deliverable, managers who grow from within the organization instead of so called fresh blood.

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97. Anonymous on June 18, 2013 7:45 PM writes...

Why all the photos all of a sudden? Advertising for marriage?

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98. Anonymous on June 18, 2013 8:04 PM writes...

From Ex MF chemist:
.."and scientists and managers did whatever it took (including baking API-containing cookies to enable chronic dosing of rabbits) to move the program forward."

As a person who has had pet rabbits - a rabbit will do anything, ANYTHING for a cookie. What a good idea.

Just like a manager, who will do anything, ANYTHING for a promotion.

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99. anon on June 18, 2013 8:27 PM writes...

@ 94 "Regarding vaccines, too bad that Merck management chased out the ones who really delivered results years ago (Emilio, Dorothy and Mike). Losing Keith just adds to the lack of vaccine understanding."

And Kathrin. Losing Keith is just abominable. Indicative of the severe dysfunction of Merck.

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100. Robert Bridges on June 19, 2013 2:44 AM writes...

I too will something make
And joy in the making;
Altho' tomorrow it seem
Like the empty words of a dream
Remembered, on waking.

...a century of comments!

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101. Current Mercker on June 19, 2013 6:39 PM writes...

@79 The director title is the result of CCF (Career&Compensation Framework) which is basically the new unified banding post merger. Hence many people became directors overnight.

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102. Voy Ragellos on June 19, 2013 8:44 PM writes...

Not just many directors, but lots of Executive Directors because they got rid of the Sr. Director level. There is a new level of Assoc. VP. They also created two levels of VPs and had Sr. VPs reporting to another Sr. VP. The proliferation was faster than rabbits.

Of course, many of the Sr. VPs are on their way out now.

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103. Anonymous on June 20, 2013 6:34 AM writes...

Too many chiefs? MRL is so inefficient because everyone is a director, executive director or VP. Some very junior level bench scientists at other companies became directors when they showed up at MRL.

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104. Anonymous on June 20, 2013 11:51 AM writes...

#103. "Some very junior level bench scientists at other companies became directors when they showed up at MRL"
Isn't that nice? The problem is that many experienced employees inside the company were pushed to low level with reduced bonus target. In this way, Merck is pushing out many good seasoned scientists (if they can find jobs) and recruiting/accumulating lots of "strategic thinkers".

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105. Anonymous on June 20, 2013 11:54 AM writes...

#103. "Some very junior level bench scientists at other companies became directors when they showed up at MRL"
Isn't that nice? The problem is that many experienced employees inside the company were pushed to low level with reduced bonus target. In this way, Merck is pushing out many good seasoned scientists (if they can find jobs) and recruiting/accumulating lots of "strategic thinkers".

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106. Anonymous on June 21, 2013 12:32 PM writes...

If someone cannot do science, just become a project manager or project leader and gets promoted to executive director. No need to actually do anything.

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107. Anon on June 22, 2013 4:48 AM writes...

Merck was a great company that developed the best medicines for the people. The more this was remembered, the greater the profits. This was forgotten and the profits have disappeared. Passion and drive for science over politics is what made Merck great in the 80s, politics destroyed Merck. The fix is simple. Go back to doing good science, drive decisions with data.

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108. Anonymous on June 23, 2013 1:46 PM writes...

It was very popular at MRL Boston, thanks to the MF mafia, to hire future leaders.

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109. Anonymous on June 24, 2013 7:07 AM writes...

I find this article so appropriate! See link below for the original posting.


The House that Max Built, or Can One Reorganize Oneself to Greatness?

Merck always was the epitome of what a pharmaceutical company should be. Growing up, I knew about what a good company it was. This reputation was largely based on the research organization that was built by Max Tishler. He led the teams that worked out the total synthesis of ascorbic acid, riboflavin, cortisone, miamin, pyridoxine, pantothenic acid, nicotinamide, methionine, threonine, and tryptophan. Tishler stepped outside his synthetic organic background and developed the fermentation processes for actinomycin, vitamin B12, streptomycin, and penicillin. Tishler also invented sulfaquinoxaline for the treatment for coccidiosis. This man basically invented the discipline of modern medicinal chemistry. He stands next to Paul Ehrlich in the discipline as one of those towering figures that looks down on the medicinal chemists of today. I wonder if he would be pleased.

Now Merck's new head of research, Roger Perlmutter, has announced plans to revamp research at Merck with a plan that will involve cuts to R&D. I have no access to the organizational structure of Merck, or it's costs or infact any inside information. However, I do know that when a research organization has problems, it almost never resides in the foot soldiers who carry out the day to day research. The choice of therapeutic areas, staffing, funding basically everything but the day to day research is a senior management problem.

Bringing in a new head of R&D is a start, but laying off the researchers will do nothing to make the pipeline more robust. The issues at Merck are deep. The shareholders should consider the way the military handles problems with performance in the field. They fire generals, not privates. If a division fails, the commander is gone. They don't cashier 10% of the privates to make a "leaner more efficient" division keeping the chain of command intact.

I firmly believe that no one has ever reorganized themselves to greatness. I believe that this is why most organizations fail over time. There is too much power in the upper echelons and the tendency to shift blame downward is too entrenched. Even the shareholder activist investors, when they wrest control from an ossified senior management, gut the company to see how they can get the largest sum, for the best parts of an organization and the devil take the hindmost. Tomorrow I will continue this thread with why I feel the merger and acquisition mania that has swept the pharmaceutical industry over the last two decades has caused this problem of weak pipelines and low levels of innovation.


http://www.victrixcmc.com/1/post/2013/06/the-house-that-max-built-or-can-one-reorganize-oneself-to-greatness.html?goback=%2Egde_915867_member_250895950

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110. anon on June 24, 2013 9:56 PM writes...

"I firmly believe that no one has ever reorganized themselves to greatness. I believe that this is why most organizations fail over time. There is too much power in the upper echelons and the tendency to shift blame downward is too entrenched. Even the shareholder activist investors, when they wrest control from an ossified senior management, gut the company to see how they can get the largest sum, for the best parts of an organization and the devil take the hindmost. Tomorrow I will continue this thread with why I feel the merger and acquisition mania that has swept the pharmaceutical industry over the last two decades has caused this problem of weak pipelines and low levels of innovation."

Thank you Peter Kim.

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111. SGP on June 26, 2013 7:37 PM writes...

Tell me again why these losers had to acquire SGP and destroy all the jobs there?

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112. SGP on June 26, 2013 7:38 PM writes...

Tell me again why these losers had to acquire SGP and destroy all the jobs there?

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113. Anonymous on July 2, 2013 9:54 AM writes...

@SGP
Because Peter Kim withdrawed Vioxx instead of adding the black box warning. That single mistake cost a lot (5B+ in lawsuit settlement, + lost in sales of roughly 20B, or 2B/year for 10 years). Also because of all his dumb purchases like was reported by #71. Without this loss, no need to aquired SGP, especially when you consider all their "very promissing clinical candidates" are actually not that good (Vorapaxar will never be a multi billion drug and boceprevir is inferior to telaprevir).

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114. Anonymous on August 1, 2013 6:45 AM writes...

113 positions will be eliminated in Kenilworth and more to come - see link below from the NJ Department of Labor:

http://lwd.state.nj.us/WorkForceDirectory/warn.jsp?printacrossID=1&StartDate=07/01/2013&EndDate=07/31/2013&DisplayDate=July%202013

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115. Anonymous on December 16, 2013 9:32 AM writes...

This is the worst company that I ever worked. The corrupt work place and many cover ups created environment that any products comes from this company can be contaminated somehow.

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