Pharmaceutical giant Merck today posted lower-than-expected third-quarter profit and warned it plans to cut, 4,400 jobs as it moves to reduce costs.
Merck owns the Gerard Laboratories operation in Baldoyle where around 250 people are employed. In May this year Gerard Laboratories said it was planning an additional 380 jobs in north Dublin by 2010. It is not yet clear if today's decision by Merck will affect those plans.
Merck said costs associated with the elimination of the jobs in the fourth quarter are estimated to be between $140 million and $200 million and will shave 4 cents to 6 cents off of earnings per share.
The Dow component also warned that fourth-quarter profit will be hurt by a revamping of Merck's drug distribution system. The pharmaceutical giant said it now expects full-year earnings from continuing operations to be between $2.90 per share and $2.95 per share.
For the third quarter, Merck said net profit slipped to $1.86 billion, or 82 cents per share, from $1.88 billion, or 83 cents per share, in the year-ago quarter.
Excluding results from Medco Health Solutions, which Merck spun off in August, third-quarter profit was up 6 per cent to $1.87 billion, or 83 cents per share.
Worldwide sales from continuing operations rose 6 per cent to $5.8 billion, the company reported. Merck acknowledged that wholesaler buying patterns negatively affected sales of a key arthritis medication, Vioxx, in the quarter.