GSK expands cost cutting drive
pharmafile | February 9, 2009 | News story | Sales and Marketing |Â Â GSK, restructureÂ
GlaxoSmithKline has expanded its restructuring plans and will make widespread job cuts in a bid to cut costs throughout its global operations.
In announcing its final figures for 2008 the company said it aimed to save $1.7bn by 2011 and reports say achieving this will put as many as 10,000 posts at risk.
The company has yet to confirm either the numbers involved or the departments that will suffer losses, but manufacturing operations are expected to be hit hard.
Chief executive Andrew Witty said: "We are very conscious of the effect this programme will inevitably have on our employees and if options exist where we can achieve our financial goals and preserve jobs we will do everything we can to do so.
"Where no other option aside from redundancy exists, we will support those employees affected in every way we can."
The restructure will also see GSK whittle down its early-stage research, to focus only on most promising molecules. The company said more than 35% of discovery projects have already been terminated as part of the rebalancing exercise.
The company endured a challenging 2008, with a number of significant patent expiries in the US and a decline in sales of diabetes treatment Avandia.
However Witty said GSK had reached the end of 2008 'ahead of expectation', experiencing a 16% rise in fourth quarter sales that came in at £6.9bn. The uplift was largely thanks to its growing vaccine portfolio, as well as its flagship respiratory product Seretide.
Chief executive Andrew Witty said the company could be confident going into the year ahead, but he was also alert to the challenges it faced.
Elsewhere other pharma companies are also cutting back. AstraZeneca last week announced 6,000 job cuts and Pfizer, which has agreed to buy Wyeth, plans to cut 15% of the combined workforce, or about 19,000 jobs.
GSK has denied it will follow rival Pfizer to pursue any takeover bids.
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