Merck & Co said it would cut annual operating costs by USD2.5 billion and eliminate 8500 jobs. The decision came after rival drug manufacturers had slashed research spending to boost earnings. Merck would cut more than 10% of its global workforce, according to a Reuters report.
Merck said that it had directed its focus in products with the best chance of winning regulatory approval. The drugmaker would also direct its focus to products that would help it achieve substantial sales. Merck's shares rose by 2.3%
The reduction of job employment in the company would be in addition to the remaining workforce cuts of 7500 positions. The furlough was from the 2011 restructuring plan that involved the elimination of 13000 positions. The restructuring plan was on job cuts that were largely of administrative personnel and sale or closure of some manufacturing sites.
Merck had been struggling in terms of sales growth following rivals Pfizer Inc, Sanofi and AstraZeneca. The competition from generic drugs had stalled sales growth of its key medicines in the company.
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