GlaxoSmithKline PLC is planning a reorganization that would include hundreds of job cuts in the US, people familiar with the situation said.
The drugmaker is poised to announce a workforce restructuring as soon as next week, said the people, who asked not to be identified discussing a private company matter. The changes would involve operations in the US, where London-based Glaxo has struggled to sell respiratory medicines in recent months. Glaxo president of North American operations Deirdre Connelly is scheduled to speak to US employees on Wednesday, two people said.
Glaxo pledged last month to cut costs by £1 billion (US$1.56 billion) over three years, with half the savings coming in 2016. US sales are flagging amid increased competition for the company’s best-selling Advair asthma medication. Analysts estimate that sales of the drug would decline 30 percent by next year, from US$5.3 billion last year.
This has put Connelly under pressure. The former Eli Lilly & Co executive was part of a management reshuffle last month, and now reports to Glaxo’s head of global pharmaceuticals, Abbas Hussain, rather than directly to chief executive officer Andrew Witty. Glaxo shares have fallen about 8 percent this year, while the Bloomberg Europe Pharmaceutical Index has climbed about 22 percent.
Last month, “GSK announced a new restructuring program to refocus our global pharmaceuticals business and deliver cost savings,” Glaxo said in an e-mailed statement on Friday. “The aim of this program is to improve performance by taking unnecessary complexity out of our operations and establish a smaller, more focused organization, operating at lower costs, that supports our future portfolio.”
Each business unit is “currently deciding how to respond to this challenge,” Glaxo said. “When we do have proposals, we will first share those with our employees.”
Glaxo told workers this month it would tweak one part of its “patients first” program in the US, which was designed to disconnect compensation of sales representatives from prescription numbers, one person said.
While the program remains in place, changes are being brought to the way sales professionals are tested on knowledge of products as part of their evaluation, two people said. Sales representatives continue to be judged on simulations of interactions with doctors and by manager observations of real meetings, one person said.
One reason for Glaxo’s poor performance in the US might be that the sales force no longer has the right incentives, some analysts have said. Witty intends to expand the model globally by early next year.
“Top performers under our previous sales compensation model continue to be some of the top performers under the patient-focused model we introduced in 2011,” Glaxo said in an e-mailed statement on Friday. “We remain resolutely committed to our commercial model and are on track to role out this approach globally.”
Glaxo has about 99,000 employees in 115 nations, with about 17,000 in the US, where the company gets almost one-third of its sales.
Stephen Garrett, a 27-year-old graduate student, always thought he would study in China, but first the country’s restrictive COVID-19 policies made it nearly impossible and now he has other concerns. The cost is one deterrent, but Garrett is more worried about restrictions on academic freedom and the personal risk of being stranded in China. He is not alone. Only about 700 American students are studying at Chinese universities, down from a peak of nearly 25,000 a decade ago, while there are nearly 300,000 Chinese students at US schools. Some young Americans are discouraged from investing their time in China by what they see
MAJOR DROP: CEO Tim Cook, who is visiting Hanoi, pledged the firm was committed to Vietnam after its smartphone shipments declined 9.6% annually in the first quarter Apple Inc yesterday said it would increase spending on suppliers in Vietnam, a key production hub, as CEO Tim Cook arrived in the country for a two-day visit. The iPhone maker announced the news in a statement on its Web site, but gave no details of how much it would spend or where the money would go. Cook is expected to meet programmers, content creators and students during his visit, online newspaper VnExpress reported. The visit comes as US President Joe Biden’s administration seeks to ramp up Vietnam’s role in the global tech supply chain to reduce the US’ dependence on China. Images on
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
New apartments in Taiwan’s major cities are getting smaller, while old apartments are increasingly occupied by older people, many of whom live alone, government data showed. The phenomenon has to do with sharpening unaffordable property prices and an aging population, property brokers said. Apartments with one bedroom that are two years old or older have gained a noticeable presence in the nation’s six special municipalities as well as Hsinchu county and city in the past five years, Evertrust Rehouse Co (永慶房產集團) found, citing data from the government’s real-price transaction platform. In Taipei, apartments with one bedroom accounted for 19 percent of deals last