GlaxoSmithKline employees are going to need courage to work for new CEO Emma Walmsley. In fact, courage is one of the criteria that employees will be measured on going forward as Walmsley impresses her own style on employees.
Walmsley is looking for ways to make GSK less conservative and more competitive to move the financial needle in the face of its challenges, the Financial Times reports. To help achieve that, she is pushing some functions and a lot of accountability into GSK’s three divisions. Their leaders will own the successes—and any missteps.
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She has had consultants review the company’s research and development unit, which has one of the lowest ratios of R&D spends to sales in the industry. Wanting to invigorate the company with some new blood, she has looked outside to fill some key positions—she hired Luke Miels away from AstraZeneca to be head of pharma—and is encouraging staff to do the same, the newspaper reports.
Some of these plans are expected to be laid out next week when GSK reports second-quarter results.
Walmsley is “big on benchmarking, and I would expect that to have a positive effect on the company’s performance,” Hilary Thomas, chief medical adviser at KPMG told the newspaper.
The new CEO has already shown she is prepared to reverse the direction, and some of the promises, of her predecessor Andrew Witty, and has the courage to take steps likely to be politically unpopular in the home country.
Last week, GSK laid out a revamp of its manufacturing in the U.K., saying it will close one plant and lay off 320, and canceling plans to build a £350 million biologics manufacturing facility that was expected to produce 500 new jobs. The closures come as the company plans about £140 million ($182 million) of investments across a number of production facilities in the U.K. by 2020.
The company also said it will sell its Horlicks nutrition brand and maybe its MaxiNutrition brand. Combined, the two generate only £30 million in sales in the U.K. It also is looking at selling its cephalosporins antibiotics business and the plants where those products are made.
GlaxoSmithKline may very well need a toughened-up staff to deal with the future it faces. Competitors continue to push forward with development of generics of respiratory blockbuster Advair. The company has kept its guidance intact but if a generic arrives midyear, it’s expecting core earnings to come in flat or decline by a single-digit percentage. It has said Advair generics could trim about 45% in sales off the $2.3 billion respiratory drug.