About this Author
DBL%20Hendrix%20small.png College chemistry, 1983

Derek Lowe The 2002 Model

Dbl%20new%20portrait%20B%26W.png After 10 years of blogging. . .

Derek Lowe, an Arkansan by birth, got his BA from Hendrix College and his PhD in organic chemistry from Duke before spending time in Germany on a Humboldt Fellowship on his post-doc. He's worked for several major pharmaceutical companies since 1989 on drug discovery projects against schizophrenia, Alzheimer's, diabetes, osteoporosis and other diseases. To contact Derek email him directly: Twitter: Dereklowe

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In the Pipeline

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February 4, 2010


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Posted by Derek

I'll start a post here so those with details on today's GlaxoSmithKline news can leave comments. I assume we'll be hearing from the UK folks shortly, and the US more in the middle of the day. I also wonder if these announcements will be like the AstraZeneca one earlier - that is, cuts to be staged over a longer period. Those are a mixed bag. They keep people employed longer (and give them some hope that there may be a place to go by the time their position gets cut), but it also spreads Morale-B-Gone dust over a place for an extended time.

Good luck to all concerned.

Comments (110) + TrackBacks (0) | Category: Business and Markets | Current Events


1. petros on February 4, 2010 7:39 AM writes...

From the press release
"We are also looking to reduce R&D infrastructure costs.
Today we have announced an expansion of GSK’s restructuring programme to deliver
additional annual pre-tax savings of £500 million by 2012 (R&D 50%; SG&A 50%). A
significant proportion of these new cost savings will be generated through reduction of
infrastructure. Approximately 70% of these new savings will be directed to the bottom line to
enhance profitability."

"We are proposing to cease research in selected disease areas.
Today, we have announced proposals to cease discovery research in selected neuroscience
areas, including depression and pain. These proposals are subject to consultation. We will
focus research activities in neurodegenerative and neuroinflammatory diseases (such as
Alzheimer’s Disease, Multiple Sclerosis and Parkinson’s Disease) where we believe the
prospects for successful registration and launch of differentiated medicines are greater."

"Today, we are creating a standalone unit to specialise in the development and
commercialisation of rare disease medicines. The profile of investing in this area is attractive
for several reasons."

Sounds like the end for the nearly empty Harlow site

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2. AharlowScience on February 4, 2010 7:46 AM writes...

Neuroscience to close and GSK to exit the field, Verona, Tonbridge, Harlow, Zagreb and others all to close. All jobs to go, support functions to relocate or close.

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3. BaldonARSE on February 4, 2010 7:55 AM writes...

I'm shutting Harlow.
Hope no one remembers how much I spent doing up my office there recently !

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4. Shocked on February 4, 2010 7:56 AM writes...

Holy sh*t. Is that true #2?

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5. Gone_in_a_Year on February 4, 2010 8:17 AM writes...

#4 Its True.

If you really want to realize the extent of how fast this (mis)management team is running from its duties try googling the following terms

GSK Foodle

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6. Anon on February 4, 2010 8:34 AM writes...

The question was asked at the Harlow meeting 'Will any of the projects in Pain/Cognition resurface in China in a while?' and the answer was 'Yes, some will probably resurface'. So not quite the exit from Pain and Depression that has been stated, more the movement of resource from Europe to China.

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7. stuff on February 4, 2010 8:35 AM writes...

"We have ‘externalised’ approximately 30% of GSK’s discovery research."

Says so much.

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8. Anon@GSK on February 4, 2010 8:44 AM writes...

Site closures are as above plus Mississauga (Canada) and Poznan (Poland). Only the 'Neurodegeneration' bit of Neuroscience has survived (Shanghai).

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9. WindPharmer on February 4, 2010 8:46 AM writes...

Enough moaning and whinging and whining everyone! GSK is funniest place in the whole world. Gone are the days when we were run by crusty old Nobel laureates and boring boffins. Now we’re run by the greatest cast of comedians, clowns and jokers in corporate history. Why even our CEO is called “Witty”. We’ve got some great magicians and conjurers who can make people, money, projects, even whole sites, disappear into thin air. They can, it seems, even make whole departments disappear only to re-appear on the other side of the world. With Moncef, a real “Comical Ali”, and Patrick, straight out of “Monty Python”, we’ve surely got the best comedy double act in the business, better than “Dumb and Dumber” or “Laurel and Hardy”. The chemistry between them is so great that we don’t need any old-fashioned chemistry anymore. Admittedly, we may have produced our share of turkeys in the last decade but with this Sitris deal we’ve surely got the $700 million comedy blockbuster of the decade. Everyone is laughing, even the shareholders! If laughter is the great cure, who needs drugs!

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10. Jose on February 4, 2010 8:51 AM writes...

"We have ‘externalised’ approximately 30% of GSK’s discovery research."

Everyone remember the combichem "Lost Decade?" This little industry wide fiasco is shaping up to make that look like a frolic in the park with a pretty girl....

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11. Anonymous on February 4, 2010 9:09 AM writes...

Sold the site already?

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12. MTK on February 4, 2010 9:09 AM writes...

Are the sites themselves, including any development functions at them, closing or is it just the discovery portions?

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13. Anon@GSK on February 4, 2010 9:15 AM writes...

#12 The sites are closing - still-required functions will be relocated to other sites

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14. Anon@GSK on February 4, 2010 9:19 AM writes...

#12 A couple of buildings on the Harlow South site are being retained

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15. Anon on February 4, 2010 9:33 AM writes...

Pharm Tech and Pharm Dev at Harlow are staying put. All R and D to close. Regulatory etc to relocate to other sites.
The Porton Down thing is probably a move to the old Merck Terlings Park site.

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16. FormerGSK on February 4, 2010 9:39 AM writes...

Tragedy. I knew of good people in Verona, UK and Mississauga. Now their lives are thrown into chaos because none of the great geniuses at GSK can figure out how to actually run things. Hell why not close all of R&D. Then Witty, Moncef, and Vallance can get into the lab and make some drugs.

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17. Gil Roth on February 4, 2010 9:39 AM writes...

FWIW, my new interview with the head of their preclinical semisorta outsourcing group Scinovo is here.

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18. quintus on February 4, 2010 9:59 AM writes...

I agree with formerGSK, this is a disaster. I feel for all those who must go, I hope it works out somehow for you all.
I'll make no comments about the GSK leadership, enough has been said above.

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19. Anon ex-GSK on February 4, 2010 10:02 AM writes...

What is really amazing is that all of this is going down in the midst of what appears to be amazing profitability. 4Q09 profits were up 66% year-over-year and 20% for the whole year. Dividends have been raised. Even the consumer business was going well, and those poor folks haven't had a real bonus in years.

Still, when you look at product sales, GSK has just a few small molecules meeting the traditional blockbuster definition. And of those, Avandia has been under assault from Nissen's worthless meta-analysis for years, and Valtrex is off patent. Today's announcements have to be laying the groundwork for dealing with the problems of tomorrow rather than today.

So much for the three-year plan and non-interference directive from management that was rolled out less than 18 months ago. You could not ask for two more incompetent people to be running your R&D drug discovery than Slaoui and Vallance. Vallance is an academic who had zero days of industry experience when he took the job, and he has--as expected--gone gaga for pop science (witness Sirtris) and is slowly driving the whole research effort into the ground.

Best of luck to all my former colleagues. There is life after GSK. It is a great place to be from, if not at.

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20. Bradman on February 4, 2010 10:42 AM writes...

Another former GSK guy wishing all my old colleagues a sincere "good luck" in the coming months. Sad to see an R&D organisation with so many good people and so much science brought so low by the two people already mentioned. They excel only in the dark arts of deceit and mendacity. As the previous post stated, there is life after GSK. But will there be life in GSK when these two jokers have finished their handiwork?

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21. PlanB on February 4, 2010 11:16 AM writes...

A previous posting to this site gives some insight into some of the problems there, ex-employees are not always the most reliable in their judgements but some of this certainly chimes with previous gripes both here and elsewhere:

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22. Anonymous on February 4, 2010 11:32 AM writes...

Does anyone ever get the feeling it's a race to the bottom? One company after another following the same strategy - what if the strategy is wrong? How this industry will look in the future I fear is not pretty. Good luck to all those involved.

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23. Skeptic on February 4, 2010 11:50 AM writes...

I am reminded of a certain Soviet dude who said that if the scientists failed to make the bomb, "we would just shoot them".

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24. Dr Bop on February 4, 2010 12:02 PM writes...


Neurosciences Drug Discovery: to very significantly refocus our drug discovery efforts in neurosciences, away from anxiety and mood disorders, depression, pain, schizophrenia, and sleep. Activity in neuroinflammation and neurodegeneration will be retained. The Neuroscience Medicines Development Centre will continue to focus on delivery of the existing late stage pipeline as well as on the current discovery assets in early clinical evaluation. These assets will be progressed and resourced into late stage based on the outcome of clinical studies and subsequent decisions made at Portfolio Management Board (PMB).

Verona, Italy: to stop all central R&D activities on the site. Late stage clinical operations and medical support for the local operating company would remain. Verona will remain the headquarters for GSK in Italy and other GSK activities on the site are not affected by these proposals.
Harlow, UK: to stop all neurosciences drug discovery activity on the site, and exit all facilities except 2 buildings on the South Site which will house Pharmaceutical Development and Molecular Discovery Research sample management.

Tonbridge, UK: to stop all R&D activities and close the site.

Poznan, Poland: to stop all central R&D activities on the site. Other GSK activities on the Poznan site are not affected by these proposals.

Mississauga, Canada: to stop all Pre-clinical Development activities on the site. Other GSK activities on the Mississauga site are not affected by these proposals.

Zagreb, Croatia: to transfer macrolide drug discovery to the Immuno-Inflammation CEDD in Stevenage and stop all central R&D activities on the site. Other GSK activities on the Zagreb site are not affected by these proposals.

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25. EX TERLINGS PARK on February 4, 2010 12:09 PM writes...

Sorry to hear that bad news I know how your feeling
been there and done that in 2005 at Terlings Park Harlow.the good news is that TP is about to be emerge from the Ashes ,as HPA buy the site ,the bad news though is for the guys at Porton Down who will
loose their jobs when they relocate to Harlow.
good luck to everyone who looses their jobs.

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26. g on February 4, 2010 12:25 PM writes...

The whole industry is scared sh#tless. Productivity has not been good for over a decade. The blockbuster drug business plan is gone. Who knows how the push for comparative efficacy will impact reimbursement and market share of new drugs? Everyone is predicting huge decreases in sales/profits of branded drugs in the near- and long-term. Hence the mad rush for consumer products, animal care products, generics, and emerging markets.

I haven't even entered industry (still in grad school) and I am seriously thinking that "industry" might not be a good place to start a career right now, or even in ten years!

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27. oldtimer on February 4, 2010 12:58 PM writes...

The statement about projects resurfacing in China says it all. Having shifted neurodegeneration to China they would not dare to close that even though it can be argued that NDG is the riskiest part of CNS. Nest question, how do you manage something n thousand miles away and how safe do you think your IP will be?

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28. CD on February 4, 2010 1:04 PM writes...

just found out today I'm one of the thousands to lose my job. Had a video presentation from Moncef saying we'd all get through this together. What a joke!

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29. PharmaHeretic on February 4, 2010 1:20 PM writes...

A system that rewards short term profits created through fraud and "rules" will ultimately eat itself. MBAs, lawyers and incompetent managers are really a symptom of a more systemic problem, namely financialism. A system that games money to make more money, without any real increase in productivity, will by necessity be disconnected from reality.

They are not interested in reality, because they can believe in their own shell games. Ironically many people who are hurt by such shell games also believed in them till it screwed them over.

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30. EX TERLINGS PARK on February 4, 2010 1:23 PM writes...

yes I remember Chris Morris our MSD Head of site saying at our Meeting "Change is good "
well thats a bunch of CRAP ,and these people who retain there jobs should be more sensitive ,because they are part of the corporate machine which brain washes us with their Management speak ,which is useless to us when we have to go and get totally different jobs . so if you are one of these people please think on when you have to give the Bad news ,we even had a guy come over from the states pointed the finger at the scientists blaming them for the site closure ,which almost ended in him being linched and was only saved by his five minders who MSD obviously thought this guy would put his foot in it.

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31. Hap on February 4, 2010 1:26 PM writes...

#28: I'm sorry. I unfortunately have Rollins' Band's "Liar" running through my head when I hear the quote from your management.

Can't imagine why.

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32. processchemist on February 4, 2010 1:44 PM writes...

I sadly remember that less than 3 years ago some people in Verona did not see the new Shangai CEDD as menace to their job...

I'm asking myself who's really pulling the strings in this industry. The management or funds and banks?
Once upon a time the pharma industry was "creating value" through R&D. Now I understand that creates value (?) cutting jobs. If research output it's not predictable, the limit of the present business model is obvious: you can't count on infinite cost cutting rounds. And you can't think that many spinoffs will rise from the ashes taking the risk of R&D... from what I hear the climate in the business angel/seed/vc field it's still pretty bleak...

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33. Pleasemakeitstop on February 4, 2010 2:55 PM writes...

So, this decision was driven by market forces? 2000 staff were due to fly business class to a huge HR leadership training jolly in Atlanta on Monday. Now that's obviously a vast waste of money. It's also a good thing for managers to be with their staff so it makes sense to call it off. But why cancel it at 11pm on the previous Friday? It smacks of panic measures. But why, when the financial results weren't that bad? Either it was a rushed decision to prove that if AZ can do it GSK can too, or it's yet another example of the incompetence of the top few layers of GSK management. I don't know which is worse.

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34. MedInformaticsMD on February 4, 2010 3:13 PM writes...

# 28 CD

just found out today I'm one of the thousands to lose my job. Had a video presentation from Moncef saying we'd all get through this together. What a joke!

At least you didn't have to take the "how to do a layoff of your staff" training program as I did as a Director in another company, just before I was laid off myself.

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35. MedInformaticsMD on February 4, 2010 3:20 PM writes...

#30 Ex Terlings Park:

these people who retain there jobs should be more sensitive ,because they are part of the corporate machine which brain washes us with their Management speak ,which is useless to us when we have to go and get totally different jobs

Employees who belive the mgmt. rhetoric fall into one of two groups: those who believe it or are comforted by it, and thus are deluded, and those who don’t believe it, but cannot speak up due to fear of retaliation or layoff, and thus may easily become demoralized and cynical.

Environments of the deluded, demoralized and cynical are not the best for leading-edge drug R&D.

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36. GSKeptic on February 4, 2010 3:20 PM writes...

So far the impact on the US sites sounds remarkably minor- that's a surprise because it's so much easier to lay off Americans that foreign-based companies usually can't resist. Am I mistaken?

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37. Noncef on February 4, 2010 3:29 PM writes...

A Message from the Great Leader

"First of all, I'd like to say thank you to all of the little European scientists for your sacrifice. Yes, I feel sorry for you, but really you should feel sorry for me, because today has hurt me more than it has hurt you. Please understand why I had to do this. The share price is 32 cents lower today than it was yesterday, and I know you'll agree that your jobs are a price worth paying for success like that. Look on the bright side, my former employees - after all, it isn't as if your opinions or jobs were worth as much as academic clinicians! We are living through difficult times, and we need to save money, to create value for our shareholders by following our new R&D strategy. As you know by now, this means investing in cutting-edge biotechnology companies run by our Harvard buddies, whose boards we will move to when our time in GSK is over. One day you'll realise that we were right so just stop complaining about it! Please don't think that you haven't been appreciated. I couldn't have afforded all this, or even have acquired so many mistresses, without you. I feel your pain. Think of me over the next few months as you see my grinning face on your homepage. Farewell!"

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38. Teoz on February 4, 2010 3:33 PM writes...

Yes it's damn real, the Research and Development unit of Verona will be closed at the end of year with the IT unit. About 600 employees have lost their jobs ... and i am one of these unlucky workers. I hope that the Italian government do something for us!

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39. David P on February 4, 2010 3:34 PM writes...

Local reports here in RTP only say GSK layoffs "may" include RTP, which is not very helpful. Seems like those guys have been reorganizing annually, with a threat of lay-offs always there. I really thought the last round had cut it all the way down (they were even hiring people for the Pfizer anti-HIV joint venture).

So is there any good news in the industry? It is getting a little depressing dropping by this blog at the moment.

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40. If only on February 4, 2010 3:34 PM writes...

Wonder what would happen if 1000 shareholders who also happen to be employees turn up at the next shareholder's meeting and demand a vote of no confidence in the board?

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41. Radical on February 4, 2010 3:49 PM writes...

It's sad that large companies like GSK feel they can dump thousands of hard working people on the scrapheap in times like these. I for one will be showing my displeasure by actively boycotting all GSK consumer products ( feel free to join me. And if China cares maybe stop buying aquafresh etc?

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42. LargerView on February 4, 2010 4:05 PM writes...

Taking a bigger picture view here, how many scientists have been lost from the industry in the past 5 – 10 years? Are all those that have been laid off, or are being laid off re-emerging in smaller companies, or as consultants within the industry? Most importantly what is the net impact on the industry pipeline? Is the pipeline simply shifting its volume from large to small companies (spreading the risk), or is the pipeline concurrently shrinking as the risk is spread? If the pipeline is shrinking, how will this affect the quality of life of the patients the industry serves? How visible is all this information within the ongoing attacks on the industry by governments and the media?

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43. Anonymouse on February 4, 2010 4:06 PM writes...

I'm another one who got axed today. In some ways I feel relieved that I don't need to worry about whether I have a job or not anymore and that my hand has been forced into finding something better to do with my life. GSK is drifting at sea with a broken rudder and the iceberg is approaching rapidly. Now glad to be in one of the lifeboats! I'll miss the guys I work with but I won't miss those two clowns running the show. Actually, I don't think I'll miss pharma either if that's the way things turn out.

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44. sympathies on February 4, 2010 5:45 PM writes...

Sorry to hear about fellow industry mates losing their jobs.

Stupid idea -> if those who've lost their jobs can band together, how about a starting up a drug discovery venture yourselves?

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45. anonymous on February 4, 2010 6:49 PM writes...

I suggest that you investigate the layoffs that are happening at sanofi-aventis this week. About 40% of the staff at the Cambridge site was told they had jobs on Monday and was laid off Tuesday. News of who was out of a job leaked in one of the research departments on Tuesday, so other departments had to spill the beans, as well. Maybe this is how it's done in France, but it doesn't go over well in the US, even with those who have the option to stay. Apparently, more layoffs will be announced in April with many more to come 4Q10.

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46. GSK on February 4, 2010 8:40 PM writes...

regarding lack of lay-offs in US:

Today (Thursday) was Europe Day for GSK's announcements.

Tomorrow will be US day for GSK's announcements.

-the neoursci cuts in Europe will also impact US

-some speculation is that inhalation product dev't will be cut from US and moved to UK, small molecule devt will leave Philly and go to RTP, Philly will focus on biotech

US hasn't been (and won't be) spared....

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47. ex-GSK'er on February 4, 2010 10:31 PM writes...

To those impacted,

My thoughts are with you. Though formerly GSK-US based, I worked with many in TON, VER, and HAR. Alot of good folks there.

-from an ex-GSK'er who "survived" multiple rounds and couldn't take it anymore..

#46: I would not be surprised if IPD went to UK, but I always had a feeling (not info - just my opinion) that if PCD activities would be focused on one US site, it would UM/UP b/c of the scale up facilities there, but I will be following closely despite the fact that it makes me ill to keep hearing of cuts there ...
Good luck everyone.

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48. WedThurFri? on February 4, 2010 10:59 PM writes...

This is why the pharma industry is doing all this. Read:
The research and marketing consultants are telling them how to run the companies and focus on the bottom line.

" Address the issue of poor R&D productivity by understanding how to effectively restructure your internal R&D organization and establish a network of alliances and partnerships for external sources of innovation."

Where's the science?????

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49. incha on February 4, 2010 11:58 PM writes...

What are governments doing about this? And if the answer is nothing, when will they start doing something? Because eventually this issue will have a huge impact on so many parts of the scientific community. For example, why will all those Chinese scientists want to read Journals from the American Chemical Society, or the RSC? Will they continue to give prizes and funding to academic departments in regions where they no longer have research presence? What about all the local support companies?
As scientists we are feeling the hurt right now, however the actions of GSK, AZ and others are going to affect the wider community very soon. I hope everyone looking for a job finds an opportunity that makes them happy, and that someone takes notice of what is going on in these companies, and stops the loss of research from both the US and Europe.

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50. annon on February 4, 2010 11:59 PM writes...

I blame the likes of Jacki Hunter.

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51. Jose on February 5, 2010 12:16 AM writes...

"Research Markets" and Bos Consulting Grp, and McKinsey, you bastards!

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52. Anonymous on February 5, 2010 2:27 AM writes...

The problem with McKinsey and the like is that they've not looked at the long term impact of what's going on. The 'sources' for all the partnerships are primarily small biotech companies, but they're getting hammered too -pulling out of research to focus their money on the one (or two if they're really lucky) products that they have in clinical trials. The upshot is that R everywhere is going downhill, so the big pharma model won't be viable in a few years because there simply won't be enough R based biotech companies to feed the machine.

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53. ppp on February 5, 2010 2:48 AM writes...

About relocating R&D to China....does anyone in the upper management of GSK, Pfizer, Novartis etc. fear that once China gets the know-how (say in 10 ys) then the Chinese Communist Party may take-over and run the business themselves?

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54. stuff on February 5, 2010 4:21 AM writes...

This article from the guardian makes interesting reading;

especially the opening paragraph: "Andrew Witty, chief executive of GlaxoSmithKline, threw out an extraordinary statistic today: between 1998 and 2007 the company produced no new molecular entities. That's right, those labs, which cost £3bn a year to run, delivered nothing novel for a decade."

If that is true it's no surprise they're closing some R&D.

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55. goofball on February 5, 2010 4:45 AM writes...

#54: If that is so then the reaction shouldn't be to close them but to replace incompetence and invest in promising research. R&D doesn't work and cannot work like a product in a grocery store.

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56. MCC on February 5, 2010 5:06 AM writes...

As an escapee from GSK and a co-inventor of the anti-cancer drug Tykerb, worked on at Stevenage, then RTP labs around the late 1990's I take particular offence at Witty's so called "statistic". Just about sums up the calamitous state of the pharma business. Run by people who neither know, nor care, what they're talking about.

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57. Anon on February 5, 2010 5:16 AM writes...

And how about Altabax, the first new class of antibacterial in 2 decades, launched in 2007.
Here is GSK's own press release.

PHILADELPHIA, PA (April 12, 2007) /PRNewswire/ — GlaxoSmithKline (NYSE: GSK) announced today that the U.S. Food and Drug Administration (FDA) has approved its antibacterial Altabax for the topical treatment of impetigo due to susceptible strains of Staphylococcus aureus or Streptococcus pyogenes, the two most common types of bacteria in this kind of infection.

Altabax represents the first new class of prescription topical antibacterials to be approved by the FDA in nearly two decades.

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58. Louis on February 5, 2010 6:16 AM writes...

So how many synthetic/process/medicinal chemists does this stick onto an already saturated UK chemical job market?

I truly feel for anyone in this position. Never worked at GSK, but we are all comrades in arms on this one. Good luck to everyone concerned.

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59. GSC on February 5, 2010 6:35 AM writes...

I was with MCC on Tykerb. It definately happened! A superb collaboration between the UK group and the US team as I recall. Yes, it was definately GlaxoWellcome, it was definately Stevenage and RTP. It wasn't a dream.

As a shareholder myself, I wonder wether this omission was deliberate or accidental.

But the share price did go up.

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60. Pastures New on February 5, 2010 6:51 AM writes...

As someone who was closely involved in establishing the GSK Singapore and later China R+D facilities, I am truly saddened and angry at GSK’s decision to cease Neuroscience research and close UK and other European sites. This is not just a sad day for European- based drug discovery but also for the many patients who only chance of improved treatments for devastating diseases such as Alzheimer’s and Schizophrenia now lies in the hands in the hands of Chinese researchers. From personal experience, there is a good reason why scientists are cheap in China-Pay peanuts, get monkeys is a phrase that springs to mind.....

Witty/Moncef-You should be ashamed of yourselves!!

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61. alig on February 5, 2010 8:07 AM writes...

You left off the rest of Witty's statement regarding prouctivity since 2007:
Witty's point, naturally, was that things looks much better now. Glaxo has accounted for 10 of the 75 new molecular entities to gain approval in the US in the past three years. It expects to get another six in the next 18 months. So, finally, the labs seem to be performing more productively.

Witty's response to the improved productivity,
Fire half of R&D.
Clearly not the smartest guy in the room.

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62. Will on February 5, 2010 8:26 AM writes...

I feel terrible for all involved - one glimmer of hope might be that this is the sort of "creative destruction" that economists talk about. Maybe all the mergers have bloated the top-end of the pharma companies and created too great a distance between mgmt and the scientists who actually discover drugs and create value

# 44 called it a "stupid idea," but I don't think it's stupid at all - the logistical and funding obstacles are immense, but I hope that many small drug-discovery startups will emerge from the ashes

Best of luck to all involved...

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63. FreeAtLast on February 5, 2010 9:03 AM writes...

#62 I wonder if that might happen. You've got to wonder if someone isn't going to be a "Honda" to the present industry's "General Motors". I recognize there are huge differences, but there's definitely a need, a market, and dysfunction of the current heavyweights. You would think someone would work this out.

Of course, the problem is that there might be nothing you can do to get around the fact that a drug can probably only be any two of the following (at least in the current regulatory and market environment): fairly effective, fairly safe, fairly inexpensive.

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64. DrDoom on February 5, 2010 9:22 AM writes...

You're assuming that the venture capitalists aren't in thrall to the McKinsey bullsh1tters as well. You are going to find it very hard to raise money for anything other than a shell company outsourcing all the wetwork to Chindia.

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65. Ex-harlow on February 5, 2010 9:35 AM writes...

Wishing the best for all my friends at Harlow.
When is the site going to actually close?

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66. GSKer on February 5, 2010 9:41 AM writes...

#60 GSK has invested hugh amount of money in Neuroscience research since the merge of GW and SB, did you see any drug coming out those high paid "scientists"? do you think all of a sudden those folks can deliver drugs for you with Alzheimer’s and Schizophrenia? BTW, why did you help to build R&D facility in Singapore and China? You could have refused doing it, right? your a little fool!

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67. GSKer on February 5, 2010 9:43 AM writes...

#60 GSK has invested hugh amount of money in Neuroscience research since the merge of GW and SB, did you see any drug coming out those high paid "scientists"? do you think all of a sudden those folks can deliver drugs for you with Alzheimer’s and Schizophrenia? BTW, why did you help to build R&D facility in Singapore and China? You could have refused doing it. feel stupid

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68. oldtimer on February 5, 2010 11:37 AM writes...

GSKer. in putting " " round scientists you insult not just the people who have lost their jobs but everyone who works to discover and develop new medicines. With that attitude you are the kind of person GSK should be getting rid of. Shame on you!

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69. pilsner on February 5, 2010 12:06 PM writes...

If you want a very specific example of the detachment between upper management and research, look no further than the fate of oncology drug discovery at the RTP site. The effort originated following the Glaxo and BW merger and was actually something good. A very functional, relatively autonomous, research team discovered both Tykerb (Her2/EGFR in collaboration with UK) and Votrient (VEGFR/PDGFR) which are now both approved cancer meds. The discoveries were made in a relatively short period of time and the team also laid the groundwork for compounds now in trials for other targets. The GSK management response: centralize, shut down oncology in RTP and move it to Philli. Brilliant.

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70. aaaaa on February 5, 2010 3:44 PM writes...

Pilsner (#69) is right and thanks for acknowledging the UK contribution to Tykerb. At last we'd got over the merger and everything was starting to go well.

Obviously time for a change. We need a new dogma ("small is beautiful"). Don't ask your staff what you should do, ask Harvard Med School, they must know. Close all the shiny newly-built labs, leave the expensive new robots to rust. Reorganise everyone into disease-focused silos (the chemists will love that). Encourage the silos to compete with each other so they stop talking. Give them all money but tell them they have to spend it externally on stuff we could do better ourselves if we had the budget. What a mess.

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71. Andrew'swittry on February 5, 2010 6:44 PM writes...

Scientist Survivor here. Been sweating bullets since Sunday about being laid off. Found out yesterday that I was safe.

Found out today from Moncef and Andrew's mouths that the driver for this was...wait for it... the Merck, Pfizer and Roche acquisitions. Mergers give you a short term cost savings, I guess, and improve some metric that wall street pays attention to. I don't know what that metric is. But the comparative cost savings that Mrk, Pfizer and Roche were experienceing were making GSK look bad, so we had to do something to impress the investors.

This is such utter bullshit, I'm astounded. I totally drank the kool aide during the DPU formation re-org -- the Therapeutic Area rebalancing was a 1.5 year long process, many external experts, many bus dev analyses of the size of the opportunity. In contrast, this is a knee-jerk reaction to our stock price. Witty also mentioned that this kind of reevaluation of our footprint would need to happen again, periodically. 18 month re-org cycle.

The thing is, I could even live with it if it were a 5 year cycle. I could justify that, if each DPU eliminated had failed to meet the objectives that they and the investment board and CET had agreed on. The DPUs and their 3 year business plans were supposed to be the cure for the short sightedness. But the eliminated DPUs heard the same promises of stability from Vallance and Moncef that I did. Their approaches had been vetted by the TA rebalancing in 2007. Their business plans had been approved in 2008. But those agreements with management were worthless, as are the ones my DPU made.

My wife is pregnant with our third and unemployed. We were getting ready to move in with my parents, for Christs' sake. A week ago, I was totally sold on the DPU concept and GSK's plan, I've met Andrew and Patrick in person and was utterly impressed by them and confident in the plan. At least, I felt, if my DPU were eliminated, it'd be because we did a shitty job. But now ... man, all the energy just went out of me today. Seriously, I feel sick. I can't believe I turned down two offers for faculty posiitons in order to come to GSK. They have laid off scientists every single year I've been here (since 2006.) I can't handle this. I can't get my work done, I can't work on the two patents we have, and I certainly can't get any program work done. Nothing but sending out resumes.

Moncef and Patrick are both going around next week, but there's nothing they can say that will enable me to get intellectual work done other than sending out my resume. The only thing they could say that would allow me to calm the hell down enough to do science is "Here is an ironclad legal contract between you and GSK which gauarantees employment for 10 years."

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72. gsk-grad on February 5, 2010 8:15 PM writes...

I am a graduate of the gsk, and have learnt a lot.. I am sorry to see good people lose jobs, but this is the trend, and was a long time coming. Anyone who didn't see this unfortunately was too busy, or not being able to see very far.. lot of highly paid middle managers, very little productivity - it is clearly cost-effective to license in a compound or endow a chair in a university. think about it objectively.. (it is hard to do, i know, when one's livelihood is involved). But you will land somewhere, think laterally, be open to try new things - and to potentially lesser pay. There are other important things in life, your family and you will find a way to provide - because you are smart and capable and inventive. Good luck!

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73. GSK zombie on February 5, 2010 8:23 PM writes...

RE - no cuts yet at RTP or Philly,

Baldoni (gotta luv him) sent out a note (garbled as always) saying that PCD would announce additional efficiencies (facility closures and layoffs) in late March. At least for RTP, they've been developing plans for a year or so regarding consoliding staff in a fewer number of buildings - and they'll give us an update in March. I thought they'd make those announcements today but no. So Philly and RTP are in limbo for a while longer.

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74. PharmD on February 5, 2010 8:28 PM writes...

# 28 CD

just found out today I'm one of the thousands to lose my job. Had a video presentation from Moncef saying we'd all get through this together. What a joke!

what was there in the video ? it was suppose to be today 9:30 EST, i missed it...can you elaborate from US perspective.

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75. Brutal @ GSK on February 5, 2010 9:10 PM writes...

Did it not seem to others @ GSK that todays video was a pre-recorded affair? Seemed to me that it was. Why also was there a RADEX member present at each site to answer questions after the broadcast but not Moncef? Was he not able to be present in the room (any room) of those he was speaking too? seems to be lacking some 'stones' if you ask me. or maybe we're in for a paper tiger until his contract runs up.

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76. GSKer on February 5, 2010 11:29 PM writes...

I am working in one of sites to be closed, hope all scientists who are luck to be bale to stay in GSK can deliver much needed medicines. All the best.

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77. Fey on February 6, 2010 12:06 AM writes...

R&D at GSK :
"...we hire you because you are the best and the brightest -- you know what the facts are and you can identify the pearls of truth in the dung-heap that is academic medical research.
We just heard back from Harvard, and they say the facts are passe, and the truth is subjective -- and the starup Dirtris with the miraculous compound detritus is at the cutting edge of scientific advancement (and the RADEX is a little bit dubious about MIT, so Harvard it is) -- anyway, you may leave now..."

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78. YOURAZ on February 6, 2010 4:42 AM writes...

AZ and GSK seems to have exactly the same strategy!

Is the next step to merge and cut R&D even more?

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79. MYAZ on February 6, 2010 6:43 AM writes...

Considering AZs patent cliff I doubt GSK would be interested.
AZs CV & GI franchise would fit very well in a merged company, but significant overlap in other areas like asthma and oncology

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80. PfishPfood on February 6, 2010 8:24 AM writes...

My guess - GSK isn't doing this for AZ.
Rather, to keep independent (and out of the clutches of Pfizer). No one is safe.

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81. GSK Zombie on February 6, 2010 8:46 AM writes...

don't look for any rationale

entire pharma industry is in a death spiral, the cost of R&D vs. the pay back is way out of wack

In US, pharma was one of the last industries to avoid third-world effect (ANYTHING can be done cheaper in poor countries, we won't talk about quality).

Now pharma is going through what ever other industry (textiles, steel, consumer electronics, auto...) has gone through.

yes it hurts when we get hit (our job, our site, our company) but its just a matter of time before pharma employment is down to 10% of its peak.

I'm just glad I've survived 5 rounds of layoffs at GSK and I'll be grateful for each additional round of lay-offs that I manage to sneak through.

yes, GSK has terrible mgt, but GSK mgt is irrelevant, once the Titanic hit the iceberg it was going to sink - even if Captain Kirk was at the helm.

The HMS Pharma hit the iceberg 10 years ago and there will be very few survivors (at any company) in the next 10 years (unless you count China & India).

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82. Anonymous on February 6, 2010 8:56 AM writes...

"Significant overlap" may seem like a red flag to us scientists but it is pure financial music to the ears of the 25 year-old MBA "consultants" who are running around gorging themselves to death on "consulting fees" by peddling their latest version of "business process solutions" to Pharma management touting the "tremendous benefits and cost savings" of "structural reorganizations" involving letting go the experienced, not so 25 year-old long term experienced, dedicated staff in favor of low cost contractors or Chinese / Indian CROs. So basically if the folks with the experience can't get it done, the obvious solution is to fire them and bring in folks with no experience. That logic is clear as mud.

For the past decade Pfizer has been touting the merits of the synergies of their Pharma mergers and reorganizations as seen through the prescient eyes of these charlatan corporate consultants and only now after a decade and a 50% drop in the stock price has Wall Street finally stopped buying into all the hype and false promises. Of course the CEO who oversaw this "paradigm shift" walked away with 180 million in "retirement benefits". I'm sure Hank sleeps very well at night.

Remember the early days when all the tv financial talking heads were falling all over themselves praising the Pfizer model as the vision of the future and screaming BUY, BUY, BUY? When was the last time you heard any of these guys saying BUY. If they loved the stock at 50 shouldn't they be backing the truck up at 19? Instead Pfizer reports its first numbers following the assimilation of WYE in the context of their "new model" and Wall Street's response is to hit the SELL button.

@71 comments above are right on track. The Pharma herd mentality is as strong as ever. I don't see why GSK expects the results to be any different for them. Then again, I'm sure the Pharma business consultants will have put together some nice PowerPoint presentations to hawk whatever new plan they have to rescue us when the current experiment fails.

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83. Doubtful on February 6, 2010 11:15 AM writes...

#72 writes: "...lot of highly paid middle managers, very little productivity - it is clearly cost-effective to license in a compound or endow a chair in a university."

Consider the last few years in GSK... a megamerger, then overemphasis on factory science (some good, some bad) then the swing of the pendulum back way too far to the opposite extreme to small DPUs all doing their own uncoordinated secretive thing and competing with each other for funds. Maybe I'm wrong and the DPU model will turn out to be fantastic, but I doubt it. Forget 3 year plans, because we have new heads of R&D more often than that, and the next one will want to make his mark by changing it all again. The problem is nothing to do with middle managers but all to do with "visionary" leaders who are more concerned with appearing to do something radical than taking time to learn from history.

Somehow, even with all that to contend with GSK is at the top of the pipeline pile. It's trendy now to say that inlicensed compounds and academia will save the industry. That will be cheap but it's never yet been shown to be effective. It'll take a few more Sirtrises before that particular myth is busted but it'll happen.

I still live in hope that one day the financial geniuses will realise that there's no such thing as a cheap drug and that the industry needs to invest more than a tiny fraction of its profits in new research if it wants to succeed. I just hope there's some of it left to save when that happens.

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84. Dr Death on February 6, 2010 3:15 PM writes...

After recently spending loads of money upgrading the facilities at the Tonbridge site its a shame it has been brutally axed and excellant talented scientists kicked out the door.

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85. Mr Blobby on February 6, 2010 3:29 PM writes...

Things just basically went downhill following the GW-SB merger-both pipelines were in efect already ehausted.The CEDDS never delivered and the artificial "wall" of compounds projected by the big wigs in 2003-04 simply never materialised. Where next for the fallen giant ? about another merger?

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86. Not My First Rodeo on February 6, 2010 7:47 PM writes...

For those who are wondering what will happen to R&D staff at the U.S. sites, take a read at cafepharma and see what the sales reps are going through. They aren't getting fired, rather they are getting "managed out". Your PDP will have impossible goals in it, which of course you can't make. Then they will put you on a PIP to "improve" your performance, which again you can't make, so they get to fire you for non-performance ... and you get zero severance pay. Anyone who doesn't get their resume updated at this point, has not been paying attention.

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87. Mr T on February 7, 2010 2:04 PM writes...

Moncef is a TW*T

Bring back Tachi!

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88. Billy on February 7, 2010 2:32 PM writes...

"The man who keeps the GSK ball rolling" - The headline from the Telegraph today, with this interesting comment...

Witty is wary of bad headlines about job losses. "We've not announced job cuts," he stresses. "Overall for the UK over the next five to 10 years I think it's highly probably that the UK will be a net gainer of jobs for GSK."

Just because you don't announce the job losses doesn't make them go away Andrew. And while it may well be true that the UK will gain jobs in your new bio-pharmaceuticals factory over the hundreds which you've not announced with the closure of Harlow and Tonbridge, they aren't going to be any good to all the chemists, biologists, pharmacologists, IT and compchem experts who you're firing today.

What about all this transparancy we hear about from Patrick and Moncef. Disgusting use of the press to spin the horrendous news for hundreds of families and the UK pharma business to make GSK look better. If there were any more jobs out there for the rest of us I'd love to see you when we turned the lights out at the rest of the R&D sites when all the fed up people have left.

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89. Pluto on February 8, 2010 3:18 AM writes...

Thanks for pointing that one out, Billy. I also think that the announcement back in January about putting their 13K malaria compounds into the public domain was a cynical maneuver to try to deflect attention from site closures and generate some good publicity. I bet we'll see site closures year-on-year, what's the betting that RTP is next?

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90. Jose on February 8, 2010 4:27 AM writes...

The press that those compounds has generated in the public health sphere is just massive "Thousands of new drugs for Malaria, dengue and diseases x,y and z too!". No one seems to realize how ludicrous and Machiavellian the whole scheme is: just a damn big CRS ploy with (presumably) garbage combichem/HTS hits.

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91. EX TERLINGS PARK on February 8, 2010 5:55 AM writes...

Its Sad ,But it looks highly likely that commercial Pharma is dead in the Uk and Europe and also it will happen in the states ,the bottom line is that they can make drugs in Asia and China a hell of alot less, also the Big animal research question is shut right down which would seem like a victory for the Animals rights goups like shack,They can now congratulate themselves on helping to subject animals to unrestricted procedures on mass in Asia.
while the Animal research question is very emotive when it was controlled by the Uk Home office restrictions it was very ethical.and the conditions far from the shack portrayed vision .So although we in the industry have lost our our jobs ,direction and faith in Pharma corporations, and what seems like waisted years of education .its like nothing to what is about to happen to the Animals welfare.
Good luck everyone effected by your company's betrayal.

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92. ex Beecham employee on February 8, 2010 10:49 AM writes...

So it is the final end of the remnants of the Beecham research. Some of the old Glaxo people must be chuckling with glee as I still remember the hatred they had for Beecham following the attempted takeover, then the patent litigation on clavulanic acid and the 5-HT3 antqagonists. No one should forget the immense contribution Beecham made to patient care.

What can we learn from these latest cut-backs? One lesson may be that, following mergers, it is not always the best people that get the key jobs. With the SKF-Beecham merger, Beecham brought all of the future products to the table, yet within a year of the merger the R&D was managed by the SKF failures! 10 years after the merger, all of the SB products in the top 50 drugs were from Beecham, apart from Tagamet that was from SKF in England. The SKF/SB senior research management concentrated on quality basic research and novel technology development rather than on delivering drugs. Also with mergers, the research is inevitably disrupted so that a 2-4 year product gap results.

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93. alison on February 8, 2010 2:58 PM writes...

dont forget all the people that work at gsk harlow , post room, catering, vending, cleaners, and all the other little companys within gsk.

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94. EX TERLINGS PARK on February 8, 2010 4:08 PM writes...

well said , these decisions effect alot of people within these organisations ,and the scientists cant do their jobs with out the great support they get from people like yourseves.

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95. ex Beecham employee on February 9, 2010 3:16 AM writes...

So the final end of any trace of the Beecham R&D sites. This is a shame and just goes to show that success does not ensure survival. In the pharma R&D business, one never knows whether you've got it right, or wrong, for 20-30 years. The programme system at Beecham was remarkably successful, delivering amoxil, augmentin, kytril, Famvir, relafen and avandia. Not bad for a medium sized pharma. company with only antibacterial expertise. In fact by 1999, 10 years after the SKF/Beecham merger, 5 of the top 50 drugs by sales had come from the Beecham side, with 1, tagamet, from SKF - and that was a british invention! So how come after the SKF/Beecham merger, the SKF management ended up running R&D and destroyed the successful Beecham project system. Not surprising that R&D delivery of products dropped to near zero! Things got little better with the GW/SB merger where no one in the senior management committee had any experience of successful drug discovery! So mergers may make short term commercial sense, but it can destroy the long term productivity.

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96. GSK GURU on February 10, 2010 4:27 AM writes...

Fire works at Harlow yesterday 9th ,were the the guy given the job of confirming the bad news ,apparently it started to kick off and he had to duck out early.
that's what happens when company's jeopardise family's futures with lies and false statements.

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97. Anonymous on February 10, 2010 11:26 AM writes...

#96 what were the false statements?

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98. random passer by on February 11, 2010 5:47 PM writes...

And here's a very nice write up about Andrew Witty in the NY Times ...

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99. GSK GURU on February 12, 2010 8:04 PM writes...

yes their is nothing like looking after another nation whilst cutting the throat of the source
that is supplying the answer .
I take it you still have your job then.

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100. Anonymous on February 14, 2010 7:58 PM writes...

At some point US citizens will realize the high price of prescription drugs in US is no longer subsidizing pharmaceutical research - but subsidizing pharmaceutical jobs in China and India.

At that point - people will be have to Rx price control. No longer any benefit to US of high price meds.

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101. back to ya on February 14, 2010 9:16 PM writes...

To 99. Anonymous:
That is not going to happen anytime soon. The US consumer is not that aware of the background economics related to the reasons for higher drug costs in the US, and the ability to get that type of regulation passed in Congress with the current mindset of the DO NOTHING FOR AMERICA, NO PARTY will not want to restrict reimbursement since "IT'S ANTI-BUSINESS, AND NOT THE AMERICAN WAY".

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102. Anonymous on February 15, 2010 7:17 AM writes...

to 99 from 100

i dont expect it to happen soon

just need the right catalyst to get americans, including conservatives, to realize that US taxpayer is grossly over spending on Rx drugs

remember up to the early '70s, no one imagined that US drivers would buy foreign cars, it only took the OPEC oil embargo to make american drivers look at foreign cars - an idea that was unthinkable at that time

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103. anonymous on February 15, 2010 7:57 AM writes...

So no cuts in US sites this time ?

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104. next one on February 15, 2010 4:13 PM writes...

Responding to Anonymous:
It was not the oil embargo, but a product quality that broke the back of the American car industry. All you have to do is look at resale values of cars, where American makes decline much faster than foreign ones, on average. Of course, mainaining the image may not be changing, at least with Toyota, & could take time to recoup this advantage as long as quality of domestic brands can be competitive.

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105. next one on February 15, 2010 4:15 PM writes...

Responding to Anonymous:
It was not the oil embargo, but relative product quality that broke the back of the American car industry. All you have to do is look at resale values of cars, where American makes decline much faster than foreign ones, on average.

Of course, maintaining the image may now be changing, at least with one foreign co. & could take time to recoup the image advantage as long as quality of domestic brands can be competitive.

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106. Nonsense on February 15, 2010 4:23 PM writes...

The head of PCD sent a note to his troops indicating more details are still to come for realignment, possibly announced by end of March. Implication is impact to the US.

See link:

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107. Veteran on March 9, 2010 5:37 PM writes...

I am sure few at terlings park would like to admit this but i spent many years working there and generally found them to be primarily concerned with upcoming stock options and which new mercedes model they could snear down their noses at the next lazy researcher. Many spent the day with extended coffee and lunch breaks and offering empty suggestions in front of the boss during meetings in point scoring exercises. I don't even know why I'm bothered in writing this- maybe I truely feel that GSK neuroscience and AZ have also failed because they were both infiltrated by the Terlings Disease.

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108. Anonymous on March 21, 2010 5:32 AM writes...

Comment 107.
Have to agree entirely - having some experience here I think some people are more interested in publishing papers than developing drugs. This is what academia is for (publishing papers) but I guess most folks prefer industry pay rates. I think some people think they are still at University and have yet to wake up and smell the coffee. A radical change is needed and I think it is coming and a lot of folks are going to find it hard to swallow. A lot of internal empires/silos will have to be removed (middle management take note) for this to happen. Unfortunately the world changes all the time and it can be very unforgiving to everyone, including those who have tried their best.

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109. Curtis Molenda on January 7, 2013 3:54 PM writes...

Together with the whole thing which seems to be building inside this subject matter, a significant percentage of points of view are generally relatively radical. However, I am sorry, because I can not subscribe to your whole plan, all be it exciting none the less. It would seem to everyone that your remarks are generally not completely rationalized and in fact you are yourself not even thoroughly convinced of your point. In any case I did enjoy reading it.

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110. Liz Abney on January 7, 2013 4:14 PM writes...

Very nice post and straight to the point. I don't know if this is really the best place to ask but do you guys have any thoughts on where to get some professional writers? Thx :)

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