Hey Ken Fraizer, this article is exactly how we all feel

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The viability of Merck is in question more now than ever.
The "leadership" past and present has failed yet collected enormous
compensation while holding others accountable.
There have been market events, conditions and lack of product approvals that were unforeseen that certainly contributed to the current condition however
the top down, siloed, bureaucratic, motivation by fear and intimidation,
hostile culture of self preservation will never change at Merck. It will Never change.
Accept it or move on because you cannot change it.
The oppressive atmosphere is depressing and uninspiring and innovation is not possible
in these conditions.

"It is what it is". This is the greatest learning from tenure with this once great and envied organization.

Good Luck and Be Well.
 




Anonymous said:
Good move, spend $3B to save $2.5 in 2 yrs
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Haven't you heard? It's the new Merck math! They've been using it in the labs for years - it's been used by HQ before but all have been too shocked to notice. You can only detect Merck math when you're pissed off (or in this case, pissed on AND off). The FDA has been wise to the labs since that Vioxx thing and now, according to the first post's story, Wall Street might be pissed too! They're onto us!
 












Anonymous said:
Good move, spend $3B to save $2.5 in 2 yrs
Click to expand...

I would still like to hear the rationale that makes this restructuring such a good financial decision and why the stock price bumped on the news. What do the analysts and shareholders understand that I do not?


Anonymous said:
I'm am trying to understand the math a little better.

http://finance.yahoo.com/news/merck-cut-costs-2-5-121933381.html

"Merck & Co, taking a cue from rival drugmakers that have slashed research spending to bolster earnings, on Tuesday said it plans to cut annual operating costs by $2.5 billion and eliminate 8,500 jobs."

"About 40 percent of the cost-cutting, or $1 billion, will be realized by the end of 2014 and will come from slicing marketing and administrative and research and development operations, Merck said. It plans to have the rest of the cuts completed by the end of 2015.

The company said it would take restructuring charges of $900 million to $1 billion this year, mostly in the third quarter."

http://www.thestreet.com/story/1205...ts-8500-positions.html?puc=yahoo&cm_ven=YAHOO

Merck expects 40%, or $1 billion, of the savings to be realized by end-2014. The restructuring efforts will cost between $2.5 billion $3 billion, two-thirds of which will be cash outlays associated with separation expenses.

I'm no finance guy but the plan is to take $1B charge in the 3Q13 to save $1B in 2014? Or is it that it will cost $2.5B and by the end of 2015 we will save $2.5B but that an annual savings of $2.5B will be incurred in 2016 and subsequent years. So no actual savings until 2016? I would like to hear from anybody that reads this announcement differently.

Oh yeah, this all happens as long as Merck doesn't change its mind and reverse direction in the next two years. As we all know this is very unlikely particularly if the shareholders start bemoaning the fact that they are now seeing the stock price rise according to their expectations during this time period.
Click to expand...
 




Anonymous said:
I would still like to hear the rationale that makes this restructuring such a good financial decision and why the stock price bumped on the news. What do the analysts and shareholders understand that I do not?
Click to expand...

The key part of 'the plan' that appeals to stock holders is 'returning value to our investors' via stock buybacks and boosting the dividend.

Keep in mind that investors can get in and out of Merck for a few bucks a trade. They just want the pop the 'plan' delivers. This is not a sustainable model and for just a few bucks people will sell stock as quickly as they bought it.
 




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