Merck to axe 7000 jobs

Troubled American drug making giant Merck and Co on Monday announced a sweeping restructuring plan that will see the loss of 7000 jobs or 11 per cent of its worldwide workforce as also the closure or sale of five of its 31 manufacturing plants.

The company said that its programme will generate a pre-tax savings of between $ 3.5 to $ 4 billion between 2006 and 2010.

The New Jersey-based company said the job cuts will take place by the end of 2008 and about one half of them will be in the United States.

The announcement of restructuring comes at a time when Merck is seen as heading towards deep trouble in the pharmaceutical world.

It is facing the potential loss of patent protection for its top selling cholesterol lowering drug Zocor-$ 5 billion in sales-- next year besides thousands of liability suits from Vioxx, the recalled painkiller.

Merck, The Wall Street Journal pointed out, also faces the prospect of yet another of its popular drugs, Fosomax, losing its patent years earlier than expected in 2008.

Fosamax was supposed to be Merck's second biggest seller and is used in the treatment of osteoporosis. Analysts are pointing out that what is hurting Merck most is the dearth of new drugs in the pipeline.