GSK's Witty sees M&A pace slowing

GlaxoSmithKline's M&A pace is likely to slow down, CEO Andrew Witty tells Reuters. The supply of transactions that will deliver GSK's required ROI is drying up, Witty says, after a year of brisk-paced bolt-on acquisitions. 

"If you asked me to forecast, I'd say the trend is that there are going to be less (acquisitions)," Witty told the news service. "I think we are in a period where they are more difficult to get at the levels we would be prepared to pay." And that's a big switch for the company, which has been on a buyout drive for the past couple of years. As you know, GSK has been snapping up companies and striking other deals as it seeks to expand and diversify.

The company has been moving more deeply into emerging markets, by buying stakes in companies such as South Africa's Aspen Pharmacare; by partnering up with other drugmakers such as India's Dr. Reddy's Laboratories; and by slashing the prices of its own products to build sales volume in poor countries. And it has been expanding in consumer healthcare--witness yesterday's deal for protein drinks maker Maxinutrition--and in generics as well.

- read the Reuters interview