Glaxo SmithKline, Pharmaceutical major has decided double its R&D
spending. Company at present spending on R&D is
2.8 billion ponds a year. The company now spends about 15% of its annual sales on research. Company is in the strong believed that by increasing its expenditure on research, it can accelerate the company
pipeline of new products. According to the Glaxo head smaller companies spend 25 to 30 % of their sale in R&D, therefore it is no logic to stick on to 15%. Glaxo says it has no immediate plans, but tries to increase it in near future. Company’s major focus will be on improvement in R&D productivity. So far Glaxo is believed to be having the worst pipeline in the industry. Glaxo most promising forthcoming product is Cervarix, a vaccine for cervical cancer and Entereg, which is a treatment for bowel problems. Company is excited by the success of its new launches like Bonviva, for osteoporosis and Requip, now approved for restless leg syndrome. According to company sources they have justified the increase in
spending in R&D. Company says it has broken its vast R&D in to smaller focus groups. Glaxo is looking for cost saving by doing its clinical trails outside America. Company claims that equivalent studies can be done in developing countries, because there doctors are US trained and work in best hospitals. Glaxo has already run successful trails in Peru and India. Company says it is not eying on merger in near future. According to it any merger which does not enhances the product pipeline, is wastage.
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