- Merck & Co. is establishing a research facility in London that will focus on drug discovery and entrepreneurial innovation, and ultimately serve as the company's new U.K. headquarters.
- The goal is to have the aptly named U.K. Discovery Centre operational by 2020. While Merck hasn't yet decided on the center's exact location within the London metropolitan area, it is already assessing "several" potential sites and has set up a temporary research facility in the region, according to a Monday statement.
- The company expects the center will create about 150 research jobs. It could also take on around 800 more employees to help with the U.K. domestic market and European clinical functions — work that is currently done at Merck's existing U.K. headquarters in Hoddesdon.
Merck, known as MSD outside the U.S., announced the U.K. Discovery Centre plans the same day that the U.K. government released its Industry Strategy, a long-term plan aimed at propping up businesses and infrastructure. It's a timely initiative, given that the U.K.'s looming exit from the European Union has stoked concerns among citizens and industry executives that such a split will hurt the state's economy.
The life sciences sector happens to be one of the key areas of interest under the strategy. In fact, the U.K. government as well as companies and charities within the sector have agreed to pump at least £2 billion into the life sciences in order to support production of pioneering drugs and medical technology. The strategy follows a report issued in August that found the industry employs northward of 233,0000 people in the U.K.and creates £64 billion worth of turnover.
Though Merck didn't disclose how expensive the project would be or how much money it would cost to build its new U.K. headquarters, some had guesses. Financial Times estimated the company would shell out about £1 billion for the project, though Reuters reported that Merck said it was too early to predict the total value.
In any case, U.K. government officials were quick to showcase Merck's move and the overall health of the state's life sciences industry.
"MSD’s commitment today, and the wider Sector Deal investment we have secured, proves the process outlined in the Industrial Strategy can give companies the confidence and direction they need to invest in the UK," Business Secretary Greg Clark said in a Nov. 27 statement. "It will ensure Britain continues to be at the forefront of innovation and represents a huge vote of confidence in our Industrial Strategy."
From its end, the U.K. — and, to a greater extent, Europe, is a valuable source of revenue for Merck. Last year, the Europe, Middle East and Africa region contributed almost $11 billion in revenue for the company, second only to the U.S.
"We believe London to be a unique bioscience centre of excellence and a key component of the established golden triangle for academic science of London-Oxford-Cambridge," Louise Houson, managing director of MSD in the UK and Ireland, said in a Monday statement.