Merck KGaA shrinks US research team as layoffs continue to batter industry

If you thought that biopharma layoffs would stay a cruel fad of 2022, you would, unfortunately, be mistaken. Merck KGaA is the latest company to downsize, shrinking its U.S. research wing by more than 100 employees.

Merck's layoffs mark at least the ninth recorded so far in the new year, more than the eight tallied in January 2022 and there’s still a week to go in the month.

A spokesperson for the German pharma confirmed to Fierce Biotech that 133 employees were leaving the company’s Billerica, Massachusetts outpost. 

“We will keep our strong research unit footprints for neuroscience and immunology and oncology, focusing on selected biological areas and scientific capabilities,” according to a statement. The cuts represent a 26% reduction to the Billerica staff, which has roughly 500 employees, and a 11% reduction in the entire U.S. wing of the company, EMD Serono. 

Merck had hinted at a downsizing to come for roughly two months, ever since announcing a change to R&D strategy that focused on relying on external innovation to bolster its pipeline. Chief Medical Officer Danny Bar-Zohar, M.D., told investors that he wanted Merck to be a “leaner organization," during an R&D call held in November to discuss the new strategy. When asked at the time whether this meant people would lose their jobs, a spokesperson said, “we are continuously looking into the structure, size and processes in the organization.” 

Merck's dealmaking efforts were on display throughout last year in a pair of research and licensing pacts with protein degradation-focused biotechs in Europe and also a multi-target ADC deal with Mersana Therapeutics. The German drug developer plans to continue to dedicate 20% of global revenue to R&D. 

German Merck’s moves are the latest in a disheartening string of job cuts that have served as a brutal reality for an industry that’s doing all it can to turn the page to a new chapter. Last week, Cyteir Therapeutics announced it would be shrinking by 70%, while ReNeuron cut 40% of its team.