Merck, a global pharmaceutical manufacturing company, is adding 425 new jobs across North Carolina in exchange for $12.5 million in incentives.
As part of its expansion here, the company will build a 225,000-square-foot drug manufacturing facility at its existing campus at the Treyburn Corporate Park in North Durham, where it will be manufacturing the active ingredients for the Gardasil shot, which helps prevent cervical cancer.
That facility will take a few years to get to full operation, with many of the jobs starting in 2022.
Gardasil has become an important drug for Merck in recent years, as the adoption of its use has increased across the world.
About 30 more jobs will be added in Wilson County as well, with the expansion of an existing packaging center facility that has been in that city since the 1980s.
However, despite the future plans for expansion, Merck’s campus will see some job losses in the immediate future, the company said after the expansion announcement at the N.C. Biotechnology Center in Research Triangle Park.
Merck said that it will be terminating its production of the varicella bulk production drug, used in chickenpox and shingles, at its Durham plant, leading to the loss of 150 full-time Merck employees and a similar number of contract employees.
Merck is moving that drug line manufacturing to its facility in West Point, Pennsylvania, because the market for the drug has gotten smaller.
”The decision to stop varicella bulk production at the site is the result of changing market conditions that have made it unnecessary to make the product at two locations,” the company said in a statement.
”Merck is committed to managing transitions for all affected employees efficiently and with respect for them and their families,” the company added. “Those Merck employees whose jobs are impacted will receive 60 days of compensation and benefits, in addition to a comprehensive severance package and job placement assistance.”
Merck has had a facility in north Durham since 2004 and currently it has around 800 employees. The company has invested $1.6 billion in Durham County over the past 15 years, N.C. Commerce Secretary Tony Copeland said at Thursday’s announcement.
Because of the way the incentive contract was signed with the state, Merck’s job creation numbers are still based off that 800 employee headcount, rather than the roughly 650 employees it stands to have after today.
That means, for the company to receive payments from the state, it will have to add back those 150 jobs plus the 400 it announced today. Though those jobs will likely be added a few years from now, when the new production facility comes online.
The state awarded a total incentive of $8.8 million to Merck, with $4.97 million being through the JDIG award.
Durham County offered $3 million in incentives, and Wilson County offered $750,000.
“I don’t want to take this for granted that we are having our fourth expansion this year,” Durham County Commissioners Chairwoman Wendy Jacobs said, referencing companies such as AveXis and Paraxel that have also recently announced new jobs in Durham.
“We know that there are many places across the country where these manufacturing opportunities aren’t happening,” she added.
“One of the things we are most excited about is that these ... new jobs that will be created in Durham, many of them do not require advanced degrees,” Jacobs said. “People that have high school degrees and the appropriate certifications can get these jobs.”
The minimum average wage for the new jobs will be $73,382. Durham County’s average wage is $68,731, while Wilson County’s is $44,012.
The Wilson County jobs are based at a packaging center that Merck has had off Interstate 95.
Merck will be required to invest $680 million in the Durham project by the end of 2023. It will invest $30 million in Wilson.
Copeland said Merck’s investment into Durham County over the years has been huge. The new “$680 million (investment) will be improving the tax base in Durham which is basically lifting everybody’s boat,” Copeland added.
Durham beat out West Point, Pennsylvania and Elkton, Virginia to win the project.
Marlene Sanders, who does government affairs for Merck, said the Triangle is an incredibly attractive place for biotech companies to invest.
“This area is one of the premier pharmaceutical and biotechnology hubs in the country,” Sanders said. “North Carolina is internationally recognized for its innovative and highly effective workforce development programs. The research universities here are among the best in the world and you have one of the top business climates.”