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Merck Strips Out Cubist

Remember Merck buying Cubist? And the problems that immediately came up around the company’s patent estate? Merck stuck to their decision, with lots of talk about how they were committed to it no matter what, but one always had to wonder what the sequel would be. Here’s David Shlaes at the time:

This announcement is bittersweet for me. This clearly continues a string of good news for antibiotics and antibiotic R&D. It is further proof that large pharmaceutical companies now agree that antibiotics can provide a return on investment and that they are willing to put there money where there mouths are. The acquisition of Cubist will also bolster the appetite of investors beyond the excitement provided by Cubists own acquisitions of Optimer and Trius last year.
On the negative side, there are always the “synergies” that go along with these mergers. The Merck investment in their antibiotic R&D portfolio has been exceedingly modest over the last decade or so. Will this change or will Merck now go about ridding itself of the Cubist R&D organization to achieve its promised cost-savings? On the risk side, essentially all of Cubist’s late stage antibiotics have come from external sources. Their own discovery organization has contributed little to the late stage pipeline. Merck’s own discovery organization has provided only MK-7655 – a knock off or avibactam – and little else for many years. How Merck will deal with the two discovery groups is a matter of concern and remains a complete unknown at least to me.

Well, by golly, here come those synergies. The Boston Business Journal says that Merck is cutting Cubist’s entire early-stage drug discovery staff, laying off all 120 of them. So anyone who thought that this might be about some sort of long-term commitment to antibiotic discovery, well, think again. This is about getting Cubist’s existing drugs, back to some unspecified point in development, but the discovery work gets raked off into the compost pile. I would not be feeling good about the prospects for the whole Lexington site, given that a Merck spokesman is quoted talking about re-evaluating footprints, etc.
Very nice. It’s true that Cubist’s own efforts were not the driver for the Merck acquisition, nowhere near, but still. After the Schering-Plough merger, and now this treatment of Cubist, you have to wonder if Merck has decided to follow the 2000s-era Pfizer strategy of M&A. You know, the one that made them what they are today, and that’s worked out so well for everyone.

63 comments on “Merck Strips Out Cubist”

  1. Anonymous says:

    And the surprise is…..?

  2. biotech capitalist says:

    This is not a bad thing. Let’s think about the ecosystem long term, as you would agree we should. The 120 early stage R&D discovery staff who have clearly proven themselves are now able (liberated?) to work their magic anew at companies that are more productive than Merck. By your post, if Merck’s antibiotic R&D is so dysfunctional, it would be a waste of talent to integrate these people in. Biotech investors around Boston realize these people had the mojo to make breakthrough drugs. They will be recruited to new companies by those investors/entrepreneurs (who yes are interested in profits). It’s a big ecosystem, and long term the ecosystem (and the public’s and patients’) interests are served best with this dynamism.
    Merck gets patents/royalties (they may be better able to cheaply manufacture/market/distribute drug?).
    Cubist R&D folk get recycled to make new drugs in productive environments (and hopefully they too personally profited from acquisition.
    Investors get profit and then fund new companies.
    Iterate.

  3. watcher says:

    Not all that much sympathy from this camp. The acquisition would have made may of the 120 instant millionaires. Isn’t that a primary goal of many biotechs…to get to the point of a buyout for making a quick few bucks?

  4. The Aqueous Layer says:

    @2. You make losing your job seem so magical, and the prospect of finding new work quite simple. I’m not sure that’s really how it plays out in the real world, though.

  5. exCube says:

    @3 most of the 120 were hired in last 5-7 years, so won’t be millionaires due to Merck. The top of the food chain with longevity will have done well. The C-level folks who left the day Merck came in all made millions, of course.

  6. Anonymous says:

    @2, sounds like the stuff of an Ayn Rand capitalist wet dream. We used to make things in this country. Now we do this. Not sure ‘this’ has much life left in it either.

  7. Dr. Manhattan says:

    @#2 “The 120 early stage R&D discovery staff who have clearly proven themselves..”
    Cubist did have an excellent Discovery Team, but they did not bring any in-house compound into the clinic. ALL of the compounds that were acquired by Merck from Cubist were in-licensed. Cubicin was a Lilly cast off (which the Cubist Development team did a great job of resurrecting) and Cubist acquired Trius and Optimer; Ceftolazine came from Astellas.
    Overall, it again (along with the recent AZ “spin off”) diminishes the number of scientists working on early stage antibiotics. Not a good thing in the long run.

  8. Teddy Z says:

    I lived through the SP-Merck thing and I have worked with Cubist. Personally, I thought Cubist had a good plan (pay for R&D with bolted on assets) and then put molecules on the market from that R&D. The science at Cubist is good, but let’s face it, in these days, its immediate gratification for companies.
    @2, #4 is absolutely right. Losing a job, even in a target rich environment like Boston, is no walk in the park.

  9. @4, @6, @7
    Sometimes when you read this blog, it seems commenters expect that after getting a PhD, they are entitled to a faculty position or a high paying pharma job and then are further entitled to 40 years of good salary growth and job stability… I wish life were that way! But the reality is that dynamism in a free market economy is the best system for growth and success at the economy level and personal level. See the URL and see how OECD countries are doing in their unemployment and look for those known for dynamism (US, UK, scandanavia…) and those not (southern EU).

  10. Farmhand says:

    It appears we are rapidly developing an entire generation of itinerant drug discovery scientists who follow the work from town to town and company to company. They give their best until the company is swallowed up and they are no longer needed. Then, they pack up their belongings and move to the next town where work is available. Maybe this is a model that works overall, but the human toll is staggering and only getting worse.

  11. Sam says:

    Unrelated question but does a nitro substituent on a phenyl group enhance aqueous solubility (does that get lost on a serum binding)?

  12. CMCguy says:

    #2 I look forward to the press release about how you have founded a new company in antibiotics discovery by adopting the Cubist Team. If only bit were that simple…

  13. Hap says:

    Except “dynamism” only seems to apply to cannon fodder – the people who made the dynamism necessary seem to get hired and paid no matter what they do.
    And of course, dynamism implies a transformation from one living thing to another. I guess it applies to compost piles, too, but I’m not sure going from productive beings to scavengers is a move up the food chain. Particularly when there seem to be fewer predators left (and useful products) to scavenge, this does not seem like “creative destruction”, but “loot and pillage”. If something better ever seemed to come from the looted materials, people might be more sanguine about the pillaging.
    At some point, if making useful things is disfavored (pays more to loot and pillage, and with greater and more certain job prospects), then the utility of capitalism will become nil, and the managing system becomes a well-hidden kleptocracy. Ask Russia how well that works.

  14. Anonymous says:

    I know several folks who are very high up the food chain within discovery at Cubist from a previous job we all used to work at. Excellent scientists, but this has probably got to be their 4th or 5th job within the past 12 years. Does the revolving door of jobs within pharma and constant relocation ever end? Pharma seems to be a dead end job. Time to move on to property management.

  15. steve says:

    @2, your philosophy is certainly shared by the Wall Street Journal editorial board. Of course, it’s also why the middle class in America is rapidly becoming extinct and the gap between rich and poor has increased exponentially. When will people learn the difference between theory and practice and the fact that extreme capitalist ideology only serves to make big companies and wealthy individuals bigger and wealthier at the expense of everyone else? As scientists we should look at the data, not the theory; by any measure the system is slanted against those of us who are actually doing the work.

  16. biotech capitalist says:

    @15, a PhD level scientist at Cubist is not ‘middle-class’. Median household income in the US is $53k, $66k in Massachusetts. I am sure Cubist scientists are being paid >2x that amount. Let’s recalibrate some of our perspectives. Living in Lexington, MA (with world-class public schools), owning cars, a nice house, lots of stuff, etc. is not middle class. Take a trip around world and see how our species lives and maybe then you’ll appreciate life a bit more. @10 “the human toll is staggering…” again recalibrate. The human toll of the victims of sex trafficking, ISIS, etc are staggering. White-collar M&A collateral damage in a hot industry space with a frothy local hub is not really on the same level.
    To be blunt, if you are smart enough to get a PhD, to discover a new drug, to have your company bought out for your discoveries, then you are smart enough to find another job.
    @13 We’ll as #15 says, follow the data. If the utility of capitalism is nil, then I encourage you to move to Russia then.

  17. another anonymous says:

    The only thing I’m surprised at is how quickly this happened. Usually after an acquistion they spend a year or two speaking soothingly to employees while they get their ducks in a row before they pull out the ax. Merck must have gotten their hands on the Cubist HR files the moment the deal was signed and started putting together packages. They never had a chance.

  18. Am I Lloyd says:

    #2, #9: How come that “dynamism” never applies to the executives, lawyers and MBAs and only to the scientists?

  19. anon the II says:

    @ biotech capitalist
    We’re not mad. We’re just disappointed.

  20. Chrispy says:

    @16 You are confusing middle class with median income. The fact that a median income does not support a middle class life really only underscores #15’s point.
    It is particularly maddening as there is so much money flying around in these deals that it would really not inconvenience those at the top if a little more was spread to those at the bottom. Merck spent $8.4 billion on Cubist — the 120 getting their walking papers could easily be given a million or two each without it noticeably denting the haul of those being made very, very wealthy. But this will not happen.
    At the end of all this churn what do we have? A compound without patent rights, yet another research group out on the streets, and a few people raking in hundreds of millions. Not good.

  21. Paul_K_1776 says:

    Biotech Capitalist imagines himself/herself to be Francisco d’Anconia (fictional character from Ayn Rand). Life is different for the other 99.9%.

  22. Hap says:

    @16: I think you missed my point – the system you espouse will turn us into what Russia is now. I’m sure that’s great if you’re a friend of Putin (or whatever person ends up with the most stuff), but for an actual functional society (one that might last through the winter)? Not so much.
    Usually when a system fails – doesn’t produce anything worthwhile, which seems to be the goal – then it gets liquidated, along with lots of people. If you think there’s a system better that this, then I guess making the current one decompose is a potential way to get there. Of course, just like Pascal’s wager, there are lots of systems to be chosen, and the most optimal one is unlikely to be chosen at pitchfork-point.

  23. biotech capitalist says:

    @19 yes, it is certainly better to leave a job on your own terms rather than someone else’s. But would the 120 R&D folk from Cubist like to be long term rolled into Merck’s sluggish antibac programs? Yes there would be no disruption to their income, but would they thrive there in a program which is not so productive? I think Merck’s management was thinking first and foremost about making money for Merck. That means, they thought that those 120 researchers would not be profitable for them at Merck. If they thought they could get another drug out of them worth billions, I am sure they would have tried. It would serve no one to have them languish for years.
    @20 and @21 If you live in an expensive Boston suburb, you are not middle class regardless of your income. Is your town as safe as a 1950s stereotypical small town from TV? Are your schools world class? Just because you spent all your money on a house, cars, and very comfortable lifestyle and don’t have any left for fancy cars and boats and stuff, doesn’t mean you are middle class.
    Biotech Capitalist is not ashamed to report that his income is $50,000/year (absolute zero benefits) for the last three years and despite some modest school loan and car loan debt, is doing well enough for his family at a small biotech company working 80 hrs/week.

  24. anon for now says:

    As Dr Manhattan @7 notes, the Cubist discovery team didn’t produce novel products from in-house R&D. Neither has Merck in many years. And, neither has anyone else been successful in NOVEL small molecule [non-natural product] antibacterial work for a long time. So you might say that the discovery groups have failed and why NOT get rid of them? Well, it’s the people who have been doing this for years who understand why it’s been so hard and might have the insight and experience to eventually help get around the impasse. Or maybe small molecule antibacterials are a thing of the past and we’d better get to work on the elusive “alternate paradigms”. On the other hand, Cubist stripped out Trius in order to get one [not novel class in-licensed] product, so maybe turnabout is to be expected. All these discovery groups, at Trius, Cubist and Merck have been [or had been] working on interesting in-house projects – but, in the antibacterial area, emphasis on short term products and profits leads to a de-emphasis on novel classes and dependence on improving successful classes or, inlicensing of such agents.

  25. milkshaken says:

    Maybe @2 can fertilize the growth of free market when his own career goes to the compost pile. His kids and wife will understand that it is for the best.

  26. biotech capitalist says:

    @25 personal nature of your post aside, I do not consider a working on a drug that fails, working for a company that goes under or being laid off in an M&A a failed career. As every researcher knows, some experiments work out well. And some don’t. Your whole career is what you make of these experiments, successes and failures.

  27. Anon2 says:

    It sounds like we should all start asking for better severance packages when signing on with a company. What should be the standard for our industry? 3mo salary, 6mo salary?

  28. Alchymst says:

    @2 M&A generate nice fees. Pfizer had the M&A rise to glory, increase sales but no new products. With your reasoning, R should just be wiped out because ROI takes too long. For share holder value- buy back shares, get a higher stock price, options for ‘suits’ worth more, etc.
    The new pharma motto We make drugs the old fashioned way- we buy them

  29. Hap says:

    Using salt water for irrigation and eating the seed corn (and then blaming your children when they can’t grow fungus on the land) always works out well.

  30. Dr. Manhattan says:

    “Well, it’s the people who have been doing this for years who understand why it’s been so hard and might have the insight and experience to eventually help get around the impasse.”
    Yes and that’s the real pity of the recent layoffs, since the crisis in antibiotic R&D is now coming to the forefront. There is attention at several government levels to this issue, as well as at private study groups.
    @24. and the Dr. is behind you and to the right in the recent DC picture….

  31. Merck also have those crazy C. difficile antibodies in phase 3

  32. Farmhand says:

    Biotech capitalist:
    As a practicing capitalist, I agree with your sentiment in the broader sense, and of course the human toll of losing a job is significant but rarely fatal. The difference is that I don’t think the current model of discovery-by-acquisition is sustainable because in the long run it will deplete a type of human capital necessary to sustain innovation. These enterprises rely heavily on the type of institutional knowledge that comes from long term, stable relationships. It’s not enough that I or any other individual scientist has a deep well of experience to tap into, is smart, and creative. I need to have a broad cross section of colleagues with whom I have a history. People whose strengths I know at a visceral level. People who can inspire me when the going get’s tough ( as it always does) and who know me well enough to know that I neither give up easily nor carry on when a change is needed. And yes, people who can tell me something I never thought of, and I know them well enough to know I need to pay attention. These are not just “nice to haves”. The history of innovation teaches us that it is essential. These are relationships that are developed over decades. Sure, you can hire-in the best that money can buy on an as-needed basis, but in my experience (and I have more than a few years at different companies to tap into), innovation is rarely driven by one person or even a team hastily assembled, especially when some of their experience is proprietary. You need a diverse collection of people who actually know and respect each other and can talk freely. So, no, we are not entitled to 40 years of stable employment. However, a degree of stability benefits the entire enterprise, and I fear that this is being lost, and we capitalists will be the worse for it.
    As for your salary and your ability to live comfortably on it, my income is about the same. The difference is, my kids have completed college, my house is paid off, and I have retired and am living off a lifetime of savings. As a capitalist, you should know that there is more to running a business or a career than meeting operating expenses.

  33. Vaudaux says:

    I get it…..not New York City, but the Manhattan project. #30 and 24.
    And yes, as bad as it is for the scientists, the tragedy is the lost science.

  34. Sympa says:

    @2: those 120 laid off probably cannot continue their work with all the “IP” remaining at Merck.
    So for them it will be a whole new start.
    Which neatly explains why the middle class is disappearing.

  35. Chemjobber says:

    That’s some high-potency trollbait. (Slow clap).

  36. Farmhand says:

    @35
    True, but one man’s bait is another man’s sushi.

  37. steve says:

    @22, that’s always the tack with people that follow your philosophy – either everyone follows my brand of capitalism or we turn into Russia. Germany is kicking our ass in productivity but everyone there has full medical insurance, workers have a say in what happens with public companies, the middle class is thriving and the gap between rich and poor is a fraction of what it is here. It’s unfortunate that you and others with that philosophy through the communist label at anyone who disagrees.

  38. Larry_K_1929 says:

    @23
    When your hard work results in a successful “exit” for the venture capital investors, what fraction of the ROI are you dreaming about receiving?
    BTW, the closest I have ever lived to Boston was when I lived in Harlem during my postdoc time.

  39. steve says:

    “throw the communist label” %$^spellchecker

  40. sgcox says:

    #37 steve
    I think you misread Hap’s comment. Or may be I did, but for me he said that unrestricted “biotech capitalist” capitalism will turn US into Putin’ Russia which has nothing to do with communism…

  41. anonymous says:

    It’s like rolling up a tube of toothpaste, the first thing to come out is discovery. Once everything in preclinical is out, they’ll roll that up too. Etc until there’s nothing left.

  42. Biotech Capitalist says:

    @32 Farmhand,
    I agree with everything you wrote in comment 32. But I will challenge you with this: must those people be in the same company? I believe in the hub effect (as in Boston, San Fran, San Diego, these places aren’t special, they are just results of positive feedback). Everything you wrote is correct, now let’s add in dynamism of the sort where this group of people need not be working at the same one company all together all for their whole careers. Imagine they work together at say Cubist for five years, then at different companies, then again in different places and overlap with each other and with new people again in another company. Now the human bonds between these people persist, and their knowledge and networks are strengthened by the diversity of experiences they have had. Just because people work well together (in all the nuanced ways you elaborated) doesn’t mean that one group of people are the best to tackle any given problem, or drug program or whatever. The dynamism mixes up teams and people putting hopefully the best around the given problem with the expectation they tap into their network. That is how it works in small biotech at least. Maybe in larger companies scientists are less able to walk outside and meet a former colleague and talk about the science they are working on.

  43. Cellbio says:

    Interesting comments and discussion!
    To #42, must these people be in the same company? What is lost with a lot of shuffling is the knowledge that you have folks whose experience lends itself to your problem of the day. Longer working relationships have always led me to know better what I can glean from others. Now that I am an elder, I try my best to impart knowledge and experience, but I also see and know, sadly, that those of us whose experience would demand higher pay, or whose prior titles are above open positions face rather uncertain employment prospects. Our mentors are being put to pasture in place of young, cheaper, and talented, teams that can move one project across a value step-up. While I think this is an important part of the ecosystem, it cannot be the entire ecosystem and it is not clear to me that it will be sustainable at a significant scale. Something as simple as belief that the career may not provide a stable salary that lets families raise kids, or concerns for career growth are driving recent PhDs to question the wisdom of their training.
    And, btw, without knowing your level of education etc, I think you provide more value than your 50k. Look around at other professions and do you not agree?

  44. Steven_P_48 says:

    @42 “… must those people be in the same company?”
    Rehash of stale advice from the 1980’s by management guru Tom Peters. You would do better to consider the ideas of Laurence Peter. The Peter Principle – managers rise to the level of their incompetence.

  45. Larry_K_1929 says:

    @43 “…I think you provide more value than your 50k…”
    No doubt that Biotech Capitalist knows the full value he provides. He’s planning to get his piece of the action when the VC guys cash out of his current gig.

  46. Biotech Realist says:

    @2 Biotech Capitalist
    “The 120 early stage R&D discovery staff who have clearly proven themselves are now able (liberated?) to work their magic anew at companies that are more productive than Merck.”
    If it were only that simple. I have seen the aftermath of a Pfizer takeover and most likely what will happen is that the 120 in the Cubist staff will end up all over the place and not all in R&D. A few will find positions that will be an improvement. Some will transition into a lateral position. Others (perhaps several) will find something completely out of R&D and that timeframe can be quite long since no company wants invest in training. Hopefully the companies in the Boston area are still active in scooping up the latest talent that has been jettisoned from biotech/pharma layoffs–geography is maybe the only plus for these people. Of course if you are over 50, good luck. What I have seen has not been promising–only a very few over 50 have remained in R&D. Not to mention the scientists from other companies that have been (or will be as in the reported upcoming Pfizer Cambridge layoffs) recently ‘synergized’ in the Cambridge area that will be competing for these supposed R&D jobs.
    I also have to chime in about this comment #23:
    “But would the 120 R&D folk from Cubist like to be long term rolled into Merck’s sluggish antibac programs?”
    My guess would be ‘yes’, since I’m sure everyone of those 120 know or have heard about the meat grinder that is the other option.
    I wish I could be optimistic about this unfortunate situation. I do hope that all of those affected will find something better.
    I enjoyed my time in R&D, but I am glad to be out of it and not having to wonder when the next axe will fall.

  47. Anonymous says:

    I don’t blame the investors, executives, nor even the scientists. I blame an unproductive and unsustainable R&D model for destroying value, so naturally this is just a symptomatic exit from that model. Mind you, the scientists are responsible for the R&D model, so actually yes, I do blame the scientists: If they could generate a good consistent return on their efforts then investors and executives alike would be throwing more money at them.

  48. cranker says:

    @46
    You got it right. Biotech Capitalist paints an ideal but unrealistic picture. Its not like the 120 R&D staff are just going to transition easily to similar or better positions. I have many friends who never got back into R&D after being laid off.
    As a Capitalist, you would have to believe in free markets. Unfortunately, the labor market is not a free market. It is manipulated by the addition of H1bs. This excess supply is added to the market to increase supply/decrease demand and thus salaries.
    @9
    After ten years of higher education, I do believe I’m entitled to an above middle class life style. MBA’s, pharmacists, doctors, dentists, etc. have one.

  49. Thelastword says:

    @42. ” Maybe in larger companies scientists are less able to walk outside and meet a former colleague and talk about the science they are working on.”
    So you are saying you just stroll outside and talk in detail about your science to people from other companies? And what company is it you work for, and do they know how loose you are with their proprietary information? Or are you just not working on anything propietary? Doesn’t sound like any biotech I have ever heard of.

  50. Some idiot says:

    @49: I disagree with a vengeance with most of what Biotech Capitalist has said in this thread. However….
    With respect, I think you have this all wrong… I have good friends and former colleagues from a number of previous jobs, and good contacts in other companies. Obviously we don’t talk in detail about what we are doing now. However, when more specific or general problems come up, there is a lot of discussion throughout the network as to ways of getting around problems. Nothing proprietary, but a lot of valuable information at any rate. And nothing that any of our employers (even the legal people) would get hot under the collar about.
    So yes, the benefits from changing workplaces in terms of expanding contacts is considerable, and should not be under-estimated. However, I cannot see that it is good enough to warrant the gutting en-masse of research activities that we are seeing at the moment.

  51. Some idiot says:

    @47: I blame (in part, at least) a corporate culture which allows bonuses for top executives in pharma to be paid on the basis of ridiculously short time frames (i.e. anything less than 10 years). Anything shorter will only put emphasis on measures that will give short-term (i.e. 5 years or less) gains, most likely at the cost of investments for the longer-term health of the company.
    And yes, I am scientist, just in case there was any doubt… 🙂

  52. TheLastWord Again says:

    @50-
    Equally respectfully, you missed my point. I agree that having a broad network from previous jobs is really helpful (I do), but networks have limits. If you have SAR that just makes no sense or have difficulty with reproducibility of an assay or can’t figure out how to improve the half-life of a proprietary compound, your network won’t help you much. Your fellow employees will, because the devil *IS* in the details, and you can’t talk about them outside your company. Generalities don’t help. I’m not saying that a 5- or 10-year old company (like mine) won’t have brilliant employees with a lot of experience from previous jobs. I’m just questioning the idea from the earlier poster that you can just stroll outside and talk to folks from other companies at “the hub” to solve your problems. You can’t, at least not for the big problems. In answer to his question, Yes, they do have to be at the same company. Whether or not they need to have been there for 20 years or more is another question.

  53. Anonymous says:

    @51: I agree with you … BUT, at the same time investors have a right to choose their investments, which includes short-term vs long-term returns and high-risk vs low-risk investments. And they also have the right to appoint executives and incentivize those executives to manage their investments accordingly. So if scientists can’t deliver accordingly, then executives are obliged to act accordingly. Sad, but true, and also fair. Having said that, my point was not to blame scientists per se, but explain why scientists need to develop a different approach to R&D that delivers good returns on a reasonable timescale. So bottom line is stop moaning, and get creative to meet the needs of investors as well as patients. Because nobody owes anyone a job.

  54. Hap says:

    I don’t disagree with the idea that companies and jobs aren’t forever – things change. What seems problematic is that 1) the benefits of churn seem to go to a very few (and appear independent of their contributions or the outcomes of those contributions) and the risks and costs seems to go to most (and to those who are generally most proximate to the value- and money-generating activities) and 2) the flexibility in the labor market only applies to the brevity of a job and not to the ability to get a new one. The point of having a Ph.D in a field is the validation of one’s ability to successfully prosecute research, but it seems to be treated as a source of short-term particular knowledge. In that case, the general abilities validated with a Ph.D. are worthless – you are no more generally employable than a steelworker (but the steelworker didn’t spend ten years and multiple hundreds of thousands of dollars of his and others’ (grant) money to acquire those skills).
    You get what you reward – rewarding dishonesty (the ability to sell in the absence or paucity of substance to sell) and financial engineering over the ability to generate useful things seems like a cheap ticket to oblivion. I don’t see how that fits any sane economic view of the world; to me, it sounds like the antagonists of Atlas Shrugged saying that everything has to work out somehow.

  55. Anonymous says:

    The I guess it’s time for a revolution: Stop being slaves for large companies and wealthy investors. Make your own destiny and stay in control of it. That’s what Zuckerberg did. And Jobs, Gates, and all the others. None of them had a penny to start, and yet none of them accepted to be anyone else’s slave. Have a great idea? Then go and do it. Stop moaning.

  56. DrugA says:

    I agree completely with Biotech Capitalist. The free market is working out great for antibiotic discovery. Wait, what?

  57. Some idiot says:

    @52: Actually, I have feeling that we probably agree on most things (and more than likely those which I consider to be the important things). The devil is in the detail… I couldn’t have put it better myself….! And yes, very often you have to be up your armpits in it yourself to have the instinctive understanding of what is wriggling around under your toes… Yes, in those cases you need someone who is just as immersed as you are, and I agree 100% that this can only be an internal person (for many reasons, including the good ones you mention).
    But I would still suggest that very often variety is the spice of life, and that sometimes a broad chat with someone who is not up to their armpits can help you to realise that it is not the thing wriggling under your toes that you need to concentrate on, but the thing swooping down from behind your head…
    (-:
    And yes, I agree with the main and central point you were making….! (-:

  58. Some idiot says:

    @53: I agree with you as regards the fact that investors putting money into something with a short-term perspective should have a reasonable chance of getting a payoff in the reasonably short term (and therefore put people in charge who can probably do that). However, what I find a bit irritating (insert here whatever other word you feel is suitable…) is when companies which have had a tradition for long-term investments with long-term payoffs being transformed by the fish-filleters into short-term profits through destructive as opposed to creative processes, by means of incentives that do nothing to encourage long term growth, and everything to increase the profit of a very few. Summed up nicely in the quote “An accountant is someone who knows the cost of everything and the value of nothing.” Apart, perhaps, from the size of their own bonus check.
    I might be a bit thick between the ears, but I actually honestly don’t see how this is moaning. And I will also say that I have been very happy with my employer. Yes, the work I do is expensive in the short term, but it has paid off handsomely for the company in the long term. In part, at least, because it has said that it is in it for the long term, and any short-term profit-takers can go jump. So it is not really a moan in that sense, but I reflection on what I (think I) see… (-:

  59. Anonymous says:

    Churn/dynamism is necessary for redeploying workers from dying industries like coal mining or steelmaking into growing ones, but in the case of pharma, I’m convinced the decline is due to the unwillingness of publically-traded companies to invest more than 2 quarters into the future, not because drugs are no longer important in the modern economy.
    Back in the old days, it was easy to expect a guy to move for a job because his wife was probably a homemaker, secretary, etc. Expecting someone to move at the drop of a hat isn’t realistic in the day of 2-career families. Even if the spouse doesn’t have a high-powered career, there’s a good chance they aren’t going to be enthused about the idea of changing their kids’ school, seeing their family once a year at Christmas, etc.

  60. Anonymous says:

    To suggest that laying off 120 antibacterial researchers is healthy or a good thing is just ignorant. The investor wins and society gets screwed. There are just too few companies investing in antibacterial research. Sure, most of these folks will end up in new jobs. Unfortunately those jobs are likely to be creating drugs that will extend a cancer patients life by 6 months, for some insane price. Or perhaps something a diabetic will take until the day they die. New antibiotics with new modes of action don’t fall from the sky, and when a company like Cubist get bought for its marketed products and then shuttered, a few make money and society gets screwed. Can you blame Merck? Yes and no. Companies with the power to change the landscape of basic medical research need to be socially aware and responsible. But as a society, we need to find a way to make antibacterials more financially lucrative.

  61. Alchymst says:

    @2 I think the term you want to use with regards to this incident is: Accelerated Depreciation

  62. MoMo says:

    Ye Gods! Cubist now gone!
    Perhaps the most saddening and important aspect of this is what will happen to all the art work?
    Merck, you know how to reach me, I’ll buy it all.

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