Incoming GlaxoSmithKline CEO Andrew Witty has a tough job. He's inheriting the company at a time when Avandia safety questions are dragging down sales and when generic competition is circling five drugs. Yesterday, the company predicted a decline in earnings for his inaugural year, and GSK shares tumbled.
The answer, Witty claims, is diversify. Selling the company's consumer health business--as some had suggested--is a non-starter, he says, because it has good margins and growth prospects; in fact that division boosted sales by 14 percent for 2007. And the company should "embrace" healthcare payers' new, tougher stance on value-for-money.
The Guardian suggests that Witty might even extend the consumer business by expanding brands such as Lucozade and Panadol. Asia is a possible growth target, too. But long-term, Witty will need to produce more new blockbuster drugs. In that, he's just like every other Big Pharma chief.