Merck to start hacking away at Cubist's workforce with 128 R&D layoffs
- On May 5, Merck will start closing down newly-acquired Cubist's Lexington, MA site and terminating 128 jobs.
- The layoffs will take about two weeks to complete.
- Despite the layoffs, Merck will still have staff and facilities in Lexington.
Merck is not the only company in downsizing mode. Shire, Pfizer, AstraZeneca, and GlaxoSmithKline are all shedding workers, too.
Merck acquired Cubist for $9.5 billion in December 2014, and many speculate that Merck paid too much—especially in the wake of the Cubicin patent loss (a day after an acquisition deal was reached). Cubicin, which generates 80% of Cubist's revenues, will lose patent protection two years early, which may compromise the $2 billion in that drug's projected sales within the next several years.
One factor that may offset the impact of this anticipated revenue loss is the mid-December approval of Zerbaxa (ceftolozane and tazobactam), which is intended to treat complicated intra-abdominal infections (cIAI) and complicated urinary tract infections (cUTI) in adults. Regardless, the layoffs will go forward.