Drugmaker Merck to put IT hub at Dell Medical School — for now

More details have been released about where Merck & Co. Inc will locate its Austin information technology hub.

It will get off the ground in early 2018 on the Dell Medical School campus. But whether it will stay there forever is up in the air.

News broke in March that the New Jersey-based pharmaceutical giant wanted to build an IT hub in the Texas capital with up to 600 jobs.

Then in August that University of Texas System regents approved a 22,310-square-foot lease for Merck on the seventh floor of Dell Med’s Health Discovery Building, 1701 Trinity St. The lease was for three years with two options for two-year renewals.

On Thursday, Dell Medical School shed some additional light on the move when it confirmed Merck’s office would be inside the school’s Health Discovery Building — for now.

It doesn’t appear that the company has leased up additional space at Dell Med; a spokesman relayed a statement that said, “No decision has been made as to expanding our original space commitment currently in the lease.” But it would be nearly impossible to fit 600 people in 22,000 square feet.

When pressed, the company said, “Merck is still finalizing their plans for the Austin IT Hub location. No final decision has been made regarding building a new facility.”

The company said it will also have employees working out of Capital Factory downtown to better connect to the startup community.

The Austin office will be Merck’s fourth IT hub worldwide, joining locations in Prague, Singapore and Branchburg, New Jersey. The hubs work on digital health products, business analytics, computer sciences and enterprise resiliency.

“This center is an anchor for the digital transformation of our core business,”Jim Ciriello, associate vice president of IT planning and innovation at Merck, said in a statement. “It will open the door to more collaboration across our core and emerging businesses, and create opportunities to connect with people and organizations who are passionate about shaping computer science to improve health care.”

Incentives on the table

The city has agreed to pitch in up to $856,000 over 10 years if Merck meets hiring requirements, including an average annual salary of $84,586 and at least $28.7 million in capital investment. The company could also receive up to $6 million from that Texas Enterprise Fund.

Merck (NYSE: MRK), which operates outside the U.S. and Canada as Merck Sharp & Dohme or MSD, had 68,000 employees across the globe at the end of 2016. It makes most of its money selling drugs such as the diabetes treatments Januvia and Janumet and cholesterol treatments such as Zetia and Vytorin, and generated $39.8 billion in sales in 2016. Merck also creates vaccines and animal health products.

Bringing a big name like Merck to Austin is a signature accomplishment for Dell Med, which welcomed its first class of students in summer 2016.

“The bio-pharmaceutical industry continues to push boundaries on innovation, access to medicines, and the economics of care, and Merck is an excellent partner to explore new models for better health outcomes,” Dr. Clay Johnston, dean of Dell Medical School, said in a statement.

On Dec. 12, Endomag said it would move its Austin offices to the CoLab at Dell Med. The company, which is based in Cambridge, England, creates a system for detecting breast cancer tumors. The deal was the result of a partnership between the Association of British Healthcare Industries and Dell Medical School.

Other British companies that plan to have a presence at the ABHI Innovation Hub at Dell Med are Deltex Medical, which makes fluid management devices; Forte Medical, which specializes in urine specimen collection; and Timesco, which makes products for anaesthesia, surgery, podiatry and primary care.

Source: Austin Business Journal
Will Anderson, Digital Editor

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