Friday, February 28, 2014

Merck Saw 33,100 Jobs Ghosted -- Just Since Schering-Plough Wipe-Out, November 2009: "Thanks Again, Fast Fred!"

If we add legacy Schering-Plough job losses to those at post bust-up Merck -- and look back about two years more -- or six years overall -- that same figure would be close to 65,000 jobs eliminated.

Being an entirely reasonable man, I cannot lay the legacy Merck, premerger job losses at Fast Fred's feet -- but I can hold him responsible for the 14,000 jobs lost at legacy Schering-Plough prior to the November 2009 bust-up, and all of these post merger 33,100 are on his tab, in my book, so Fred Hassan directly or indirectly destroyed around 48,000 careers, in just under six years.

For his trouble, he took away, all in -- about $325 million (if he held on to most of his merger transaction equity payouts), in Merck's current NYSE stock price, pension enhancement benefits, bonuses, golden parachutes and all other cash compensation. God Bless America(!) -- she gets just about the sort of business leadership she. . . deserves.

From page 83 of the SEC Form 10-K, filed overnight, then:

. . . .Since inception of the Merger Restructuring Program through December 31, 2013, Merck has recorded total pretax accumulated costs of approximately $7.2 billion and eliminated approximately 26,880 positions comprised of employee separations, as well as the elimination of contractors and vacant positions. Approximately 6,300 position eliminations remain pending under this program as of December 31, 2013, which include the remaining actions under the 2008 Restructuring Program that are now being reported as part of the Merger Restructuring Program as discussed below. . . .

To be fair, Tom, Tom, Brent and Carrie also share blame here -- and between them, with Fred -- the figure received over those six years, all in is now north of $600 million. Disgusting.

That executive team wiped out the equivalent of entire smallish New Jersey township's population -- and pocketed almost two thirds of a billion to do so.

And we haven't even mentioned the securities fraud (alleged, and now settled) -- they committed, that cost Big Merck and its insurers $688 million, during the same period. Fabulous.


Anonymous said...

Condor, in quarterly Employee Business Briefings (held after financial reporting to the Street) Ken has been outright telling anyone who will listen that his charge is to return Merck to pre-merger headcount. It's no secret and anyone who has spent any time with Ken will tell you it is on his mind a lot.

That would be in line with the net employees from all of the 'restructuring'. The proverbial million dollar question is whether there will be more to come beyond that number if earnings are still falling short. I first recall the statement ringing my ear in mid-2011 and raised my hand shortly thereafter.

Anonymous said...

It is phenomenal that those complicit in this deliberate misadventure still remain in leading positions. The rot remains. Look at the medical leadership at the time at SP and look at the medical leadership at Merck now. ENHANCE wasn't designed by marketeers alone - they needed medical to put the right shroud over it.