Last month's news that Merck ($MRK) is to lay off 8,500 staffers began speculation as to exactly where the ax would fall. Since then, pink slips have begun circulating and the fate of staff at the manufacturing unit has become clearer: 500 workers at the West Point plant will start the New Year looking for a new job.
Details of cuts at the Pennsylvania facility were revealed in a WARN notice, which companies must file 60 days before making large layoffs. The 500 workers will leave the company over the holiday period, with Merck planning to make the cuts from December 23 through January 5. It is currently unclear which areas of Merck's 12,000-strong Pennsylvania workforce will be affected by the cuts, with the WARN notice containing few details and media reports offering little more.
Activities at West Point include the manufacture of the bulk varicella active pharmaceutical ingredient (API) used in Merck's resurgent shingles vaccine Zostavax, as well as chickenpox vaccine Varivax. However, Merck's reliance on the facility was lessened in September when the FDA approved its Durham, NC, facility to manufacture the API.
Both sites have benefited from Merck's $1 billion investment in its vaccine-supply infrastructure, but for now, the West Point manufacturing and research site is bearing the brunt of the cuts. Merck is making the cuts in a bid to shave $2.5 billion from its overheads. Last month it closed a plant in Kenilworth, NJ--the state expected to be hit worst by the restructuring--and laid off 113 staff.