Monday, February 1, 2010

Glaxo said to cut up to 4,000 more jobs

By Tracy Staton

New month, new layoff announcement: GlaxoSmithKline is plotting to cut up to 4,000 more jobs, with an announcement coming later this week accompanying its earnings, London newspapers are reporting. Most of the lost jobs will come from the U.S. and Europe as the company continues to broaden its global focus.

If that's the case, then we're likely to see more of the sort of changes that GSK undertook last year, when it cut 2,000 sales jobs in the U.S., but prepared to add 1,500 staffers in fast-growing China. More resources will be shifted away from slow-growing, long-industrialized markets and to less-developed countries whose drug markets are on a steep upward curve. Some of that shift could come in R&D as well as manufacturing and sales; the Sunday Times reports that alongside the job cutbacks, Glaxo also will announce an R&D efficiency drive.

As the Financial Times notes, this latest restructuring is hardly a new idea at Glaxo. The company appears to be accelerating changes that CEO Andrew Witty set in motion soon after he was appointed two years ago. The aim being to diversify beyond on-patent prescription medications and to invest less in mature markets and businesses and more in fast-growing segments such as consumer health and emerging markets.

Glaxo's job cuts would come hot on the heels of newly announced cuts at AstraZeneca. Last week, that company said it would trim another 8,000 jobs from its workforce, in addition to the 15,000 cuts announced last year.

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