Drugs giant expected to announce loss of 4,000 jobs worldwide

Drugs giant GlaxoSmithKline is expected to announce plans to axe up to 4,000 jobs this week as part of its ongoing restructuring, it has been claimed.

It is thought the majority of the cuts will be made to its European and US workforce, as the group shifts its focus to emerging markets, according to The Sunday Times newspaper.

The group, which employs 99,000 staff across the world, is trying to find 1.7bn of annual cost savings by the end of 2011, and improve the efficiency of its research and development arm.

Hide Ad
Hide Ad

It is also shifting its focus away from low growth markets in the West to emerging ones, such as China, where there is greater potential to expand sales, as well as developing its consumer products division.

Glaxo is expected to announce the planned job cuts alongside its full-year results on Thursday, when it is thought the group will report a return to annual profits growth, following an 11 per cent fall during the previous financial year, boosted by sales of its swine flu vaccination.

The group recently said it was expecting an 835m sales lift in the final three months of its financial year from sales of the vaccination.

But it is unlikely to receive such a big boost in future as governments are renegotiating agreed orders after the severity of the pandemic has proved less than was previously anticipated.

Hide Ad
Hide Ad

Overall, analysts are expecting the group to report a 12% rise in profits to 8.69 billion, with sales of 28.23 billion.

Within this, the consumer products division, which includes household names such as Lucozade, Ribena and Aquafresh and Sensodyne toothpaste, is expected to report an 18 per cent jump in annual sales to 4.7bn.

The announcement of job cuts by Glaxo would be further bad news for the pharmaceutical sector, after rival AstraZeneca said it would be slashing a another 8,000 jobs from across its global operations.