Embattled drugmaker Merck & Co. said Monday that it will cut about 7,000 jobs, or 11 percent of its work force, and will close or sell five of its 31 manufacturing plants by the end of 2008 in the first phase of a reorganization strategy meant save up to $4 billion by the end of the decade. The restructuring announcement, anticipated by Wall Street, comes as Merck faces the loss of patent protection for its blockbuster cholesterol drug Zocor -- the world’s No. 2 drug by revenues -- next June, plus thousands of lawsuits and billions in potential liability from its recalled painkiller Vioxx. With expected Zocor sales of $4.2 billion to $4.5 billion in 2005, Merck expects sales to drop to $2.3 billion to $2.6 billion in 2006 because of competition from generic drug makers. Whitehouse Station, N.J.-based Merck also said it will revamp its supply chain and outsource some manufacturing as part of the reorganization, which should bring about half the anticipated savings. Merck said the cuts are intended to reduce the company’s cost structure, increase efficiency and enhance competitiveness.
