The estimated $1 billion media account for GlaxoSmithKline Consumer Healthcare is in play again. The pharma is reviewing its agencies less than three years after its Novartis asset sale-and-swap and just six weeks after GSK agreed to buy Novartis' remaining share in the pair's OTC venture to take full ownership of the business.
At the time of the asset swap and partnership in 2015, GSK did a review and consolidated with its two incumbent agencies, Omnicom's PHD and WPP’s Mediacom. Those two, however, now seem to be on notice, with all six major ad networks invited to pitch, Adweek reports, opening up to Publicis, Dentsu, Havas and IPG. PHD currently handles North American duties for GSK, while Mediacom handles the overseas work.
The payoff for the winner (or winners) is potentially huge: GSK spent more than $1 billion on media in 2017, Adweek notes. But the British drugmaker isn’t showing its hand, noting in a statement to FiercePharma only that, “GSK periodically reviews its media buying arrangements to ensure they are continuing to deliver the best value to the business.”
RELATED: MLB All-Star Justin Verlander joins pitch for GSK allergy med Flonase
While this review seems consistent with its every-three-year process, the last review in 2015 came on the heels of the multibillion-dollar shuffle in which GSK exchanged its cancer portfolio for most of Novartis' vaccines.
GSK Consumer Healthcare then operated as a joint venture between the two pharmas until recently, with GSK as the managing partner and the larger stakeholder at 63.5%. In March, GSK agreed to buyout Novartis’ 36.5% stake for $13 billion. Just days before the announcement, GSK dropped out of bidding for Pfizer’s OTC assets.
RELATED: Bayer, GlaxoSmithKline find consumer health is not the sure safe haven they expected
Consumer Healthcare is one of GSK’s three main divisions, along with Pharma and Vaccines. It is the second-largest division after pharma, accounting for sales of £7.8 billion of the company’s total £30.2 billion revenue in 2017. CEO Emma Walmsley is the former head of the consumer business, which is now headed by Brian McNamara.