GlaxoSmithKline (GSK) has admitted some British jobs will be axed as it embarks on a range of cost-cutting measures designed to offset falling sales of its diabetes treatment Avandia (rosiglitazone).
The move is part of a drive to save up to £700m in annual costs within three years.
The group, which employs more than 100,000 people globally, confirmed that it will close a number of manufacturing sites as part of the strategy, adding that it is “inevitable” some of its 22,000-strong UK workforce will be affected.
GSK’s manufacturing division and the group’s selling and administration arm will be hardest hit by the cost reduction plan.
The divisions will each contribute 40% of the £700m in savings, with the remaining 20% to come from research and development.
Jean-Pierre Garnier, chief executive of GSK, said: “Sadly there will be some job losses and possibly site closures, subject to consultation, and we’ll do everything we can to support everybody involved in the process.”
The news comes as the pharmaceutical giant announced a 7% drop in pre-tax profits to £1.88bn for the three months to the end of September.
Sales of Avandia plummeted by 38% in the quarter to £225m with demand for the treatment 10% lower than experts had predicted.
The drug was a one-time best-seller for GSK, but sales have tumbled since evidence was presented earlier this year which linked it to an increased risk of heart attack.
Copyright © PA Business 2007