Drugmaker GSK launches £1.0bn cost-cutting

British pharmaceuticals giant GlaxoSmithKline on Wednesday launched a fresh drive to slash costs — by £1.0 billion ($1.3 billion, 1.1 billion euros).

The news came as the group said it had more than halved secondquarter net losses, aided partly by a pound weakened by Brexit uncertainties. GSK, under newly-installed chief executive Emma Walmsley, will seek the latest round of cost savings by 2020 on the back of supply chain efficiencies and administration cutbacks.

The cash generated will be earmarked for funding new product launches, research and development, and for offseting price pressures.

“A key driver of the new savings will be through realising efficiency improvements in the group’s supply chain,” the company said.

“This will include changes to GSK’s manufacturing network, divestment and exit of more than 130 non-core brands, reductions in overheads, improved procurement savings and more strategic supplier relationships.”

GSK will seek also to prioritise its areas of business, with a particular focus on respiratory and HIV/infectious diseases, as well as oncology and immuno-inflammation.

Following a review of research and development activities, GSK has decided to stop more than 30 pre-clinical and clinical programmes which are “unlikely to generate sufficient returns”. (AFP)