Laid-Off Merck Staff: Did You Get Your $112,000?
It has cost Merck (MRK) roughly $112,366 to lay off each of 4,310 executives since it announced a restructuring program late last year, according to an SEC filing. The restructuring was announced in October 2008, and Merck gave an update in its most recent 10-Q (see page 43).
The company is in the process of axing 7,200 jobs through 2011. Forty percent of those jobs are in the U.S. As of Sept. 30, it had laid off 4,310 people. Merck reported that the cost of the severance packages was $484.3 million for the first nine months of the year — roughly the same time period as the cuts have been going on.
A little back-of-the-envelope math reveals that the average cost to Merck of laying off each staff member is $112,366. That would include health benefits, retirement provisions and other non-cash payments.
This thread on CafePharma indicates that sales reps get about $50,000 in severance cash.
Image by Flickr user borman818, CC.
Jim Edwards, a former managing editor of Adweek, has covered drug marketing at Brandweek for four years, and is a former Knight-Bagehot fellow at Columbia University's business and journalism schools. Follow him on Twitter or send him an email.
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