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Merck KGaA to cut jobs across ‘all businesses and regions’

Increased competition for Rebif drives efficiency measures at German pharma firm

Merck KGaA is planning to cut an undisclosed number of jobs from its global workforce as part of a drive to reduce costs.

The company's chairman Karl-Ludwig Kley said that while the move was regrettable, measures to cope with an evolving healthcare market and increased competition for key products could lead to “workforce reductions across all businesses and regions”.

Kley said: “We have specifically not published potential figures related to the efficiency programme as we are committed to engaging constructively with the relevant stakeholders to achieve a mutually acceptable solution.''

A Merck spokesperson declined to comment on specific details of the cuts when contacted by PMLiVE, saying it was “important to talk to employees first”.

The efficiency measures come as Merck is poised to lose a large part of its revenue due to increased competition for its injectable multiple sclerosis (MS) treatment Rebif (interferon beta-1a).

Rebif is currently the company's top-selling drug but its revenue is expected to be hit hard by the introduction of oral MS medicines onto the market. Novartis' Gilenya (fingolimod) was the first of these, but another oral MS drug, teriflunomide, is in development at Sanofi. In October Sanofi published trial data for teriflunomide showing it met its primary end point.

Merck has had less luck with its own attempts to authorise an oral MS medication, pulling both European and US authorisation applications for cladribine after regulators requested additional data from a clinical trial that would take several years to complete.

Other competition for Rebif includes Sanofi's injectable treatment Lemtrada (alemtuzumab), which outperformed Merck's drug in a head-to-head trial, with Sanofi expected to submit both US and EU marketing applications by the end of March.

Elsewhere in the company's efficiency plans, Merck said it intends to set up a new leadership organisation in an effort to streamline its organisational structure and make it easier and quicker to make decisions.

Future plans include investing in areas of growth based on broader industry trends to drive the company's long-term strategy.

Areas where Merck has developed in recent years include China, where it has invested €150m in R&D and made such acquisitions as its 2011 takeover of Beijing Skywing Technology.

27th February 2012

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