133-Year-Old Pharma Giant Announces Layoffs, Files WARN Notice Amid Restructuring

Merck & Co., which is a major and also one of the long-established drug manufacturers in the world, has taken the decision to let go of some employees as a part of its Comprehensive restructuring plan. The company has notified through WARN (Worker Adjustment and Retraining Notification) about the future layoffs, thus indicating more cuts in the workforce in the near future.

The WARN Act mandates the employers to provide the affected employees with written notice of at least 60 days before the layoff or closure of the facility, thus allowing the workers to get ready or take retraining.

Layoffs Associated with Cost Cutting and Patent Expiry

Patents for the major drugs are about to expire and the company will thus be under financial pressure for the coming years. Its foremost cancer medication, Keytruda, and the well-liked vaccine Gardasil will have their patents expire in 2028 which will put them in the market with cheaper biosimilars.

As a reaction, the company is setting a goal of $3 billion annual cost saving by 2027, along with cutting down the administrative, sales, and R&D divisions.

Merck CEO Rob Davis previously confirmed that the restructuring program will include eliminating thousands of positions. The company has already laid off workers throughout 2025 and recently filed a notice to cut 204 additional jobs at its Rahway, New Jersey campus in February 2026 — following earlier layoffs of 58 employees in August.

Political and Pricing Pressures Mount

The layoffs come at a time when U.S. drugmakers are under intense scrutiny over high medication costs. Merck has been negotiating with the federal government over pricing reforms and previously challenged Medicare pricing authority under the Inflation Reduction Act.

With shifting policy under ongoing presidential agendas and increasing regulatory pressure, pharmaceutical companies face uncertainty on revenue margins traditionally driven by premium drug pricing.

Merck Restructures Operations in New Jersey

Merck originally moved its headquarters to Rahway in 1933 and is now consolidating operations back into that location. The transition includes selling previous campuses and relocating departments to streamline operations.

Earlier this year, the former Kenilworth campus was sold to AI data center company CoreWeave for $322 million.

Revenue and Future Pipeline Investments Continue

Despite the restructuring, Merck continues to invest heavily in new drug development and mergers. In late 2025, the company finalized a $9.2 billion acquisition of Cidara and a $10 billion deal for Verona Pharma to strengthen its portfolio ahead of patent cliffs.

Merck reported $17.3 billion in revenue during Q3, a 4% annual increase, driven largely by Keytruda’s continued growth — though Gardasil sales saw a decline during the same period.