Fears for 16,000 jobs as groups set to merge 09/03/2009 - 15:09:54
Pharmaceuticals group Merck today announced a $41.1bn (€32.5bn) takeover of Schering-Plough in a deal creating a new global drugs giant.
The two US groups are expected to join forces later this year, bringing together the makers of blockbuster treatments including cholesterol drugs Zetia and Vytorin.
But Merck said the deal is likely to be followed by an eventual reduction of around 15% in the combined global workforce, which suggests some 16,000 jobs could be lost.
Major pharmaceutical firms worldwide have announced tens of thousands of job losses in recent months as they suffer amid competition from cheap generic rivals.
The sector is consolidating at a fast pace to battle slowing sales, with Pfizer less than two months ago unveiling a $68bn (€53.8bn) deal to buy Wyeth.
The firms announced heavy redundancy programmes last year, but said today the deal should allow them to deliver annual cost savings of about $3.5bn (€2.77bn) each year after 2011.
Richard Clark, chief executive of Merck, said the takeover would create a firm “built for sustainable growth and success”.
He added: “The combined company will benefit from a formidable research and development pipeline, a significantly broader portfolio of medicines and an expanded presence in key international markets, particularly in high-growth emerging markets.
“The efficiencies we gain will allow us to invest in strategic opportunities, while creating meaningful value for shareholders.”
The newly enlarged company will be called Merck and is set to be headed by Mr Clark.
