More Job Cuts for Struggling GlaxoSmithKline, 180 Affected in North Carolina

More Job Cuts for Struggling GlaxoSmithKline, 180 Affected in North Carolina
March 24, 2015
By Mark Terry, BioSpace.com Breaking News Staff

UK-based GlaxoSmithKline announced Monday that it was laying off more people in the U.S., this time 180 employees in North Carolina. According to a Worker Adjustment and Retraining Notification (WARN) filed with the North Carolina Department of Commerce, the layoffs will occur in sales, marketing, operations and other areas.

In late February the company filed a WARN with the state of Pennsylvania indicating it would lay off 150 people in its commercial and research and development group near Philadelphia. It also announced on Jan. 22, 2015 that it was laying off 1,000 workers in its China operations.

In December GSK announced it was cutting approximately 900 positions in research and development in the Research Triangle Park, N.C. facilities. Approximately half of those people were offered positions at Parexel , a contract research organization (CRO). The individuals who took the positions with Parexel are still working at GSK’s campus, which has a lease agreement with Parexel.

“The restructuring is intended to improve operational performance and contribute to a multiyear cost savings initiative across our commercial operations, global support functions as well as the R&D (research and development) and manufacturing facilities,” stated the WARN written by GSK vice president of Human Resources Lisa Benna.

In October GSK announced major restructuring company-wide that would save over $1.6 billion in annual costs over three years. It announced a three-pronged approach to long-term financial performance. The three prongs were diversification of its global business, delivering more products of value, and simplifying its operating model.

“This new restructuring program will rescale commercial operations, global support functions and relevant R&D/manufacturing across pharmaceuticals and is expected to delivery cost savings incremental to the existing announced programs and additional benefits anticipated from the proposed Novartis AG transaction,” GSK announced in an Oct. 22 press release. “All restructuring proposals affecting headcount will be subject to employee consultation where applicable in accordance with legal requirements.”

The company has been hard hit by declining U.S. sales of its blockbuster asthma medication, Advair. In 2013 sales of Advair hit $5.3 billion, but analysts project sales will drop by 30 percent in 2015.

The company was also rocked by a bribery scandal in China that resulted in $500 million in fines, as well as criminal charges for GSK’s China general manager Mark Reilly and four other company managers.

GSK’s 2014 third-quarter results indicated a breathtaking drop of net income by 62 percent and a 13 percent decrease in global sales.

“These are not new job reductions,” said Melinda Stubbee, spokeswoman for GSK in a statement, “but are the continuing implementation of the reductions we announced in early December 2014.”



BioSpace Temperature Poll
U.K.-based GlaxoSmithKline filed a WARN letter in late February with the state of Pennsylvania indicating another 150 people would be laid off in its commercial and research and development group near Philadelphia. BioSpace wants to know if you think Pharm Country will do what it takes to keep biotech jobs in the area?

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