Merck announced that it will cut 150 jobs at its Durham, North Carolina Gardasil manufacturing plant, with 147 plant workers and 7 other positions affected. The layoffs, which will take effect on May 1 2026, follow a WARN Act filing in late February that required the company to notify employees and regulators of the impending workforce reduction.
The decision comes amid a steep decline in demand for Gardasil. Global sales fell 39% in 2025 compared with 2024, and sales in China collapsed from $3.5 billion in 2024 to $193 million in 2025. Merck reported zero Gardasil sales in China in Q4 2025 and no shipments are expected in 2026. In the United States, the FDA’s recommendation of a single‑dose schedule—down from two or three doses—has further reduced demand for the vaccine.
The Durham facility, a $1 billion investment completed in March 2025, was originally expected to create 400 jobs. The layoffs highlight a mismatch between the plant’s production capacity and the current and projected demand for Gardasil, underscoring the company’s need to realign its manufacturing network with market realities.
Merck’s Q4 2025 results showed worldwide sales of $16.4 billion, a 5% increase from the prior year, and a non‑GAAP EPS of $2.04, up 19%. While oncology and other emerging products drove growth, the weak vaccine segment pressured the company’s outlook. For 2026, Merck guided sales of $65.5 billion to $67.0 billion and EPS of $5.00 to $5.15—both below consensus—reflecting patent expirations, acquisition costs, and the ongoing Gardasil headwinds.
Management said the company “continually assesses our operations and evolving business needs and adjusts as needed to ensure the effectiveness of our manufacturing network.” The statement signals a strategic pivot away from Gardasil toward specialty and infectious‑disease products and a separation of oncology and non‑cancer businesses.
The job cuts underscore Merck’s broader restructuring to manage declining vaccine revenue while maintaining growth in other segments. Investors are focusing on the guidance miss and the company’s shift in portfolio, which may influence long‑term forecasts for the firm’s earnings and cash‑flow generation.
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