DIVERSIFICATION NOT THE PATH FOR GLAXO

Many pharmaceutical companies are responding to the changing environment by diversifying into generics and over-the-counter medicines. Rationalization and restructuring programs are also being implemented, as companies reshape themselves for the 1990s and beyond. However, Richard Sykes, deputy chairman and chief executive at Glaxo, said at an analysts' meeting to explain Glaxo's policies in the changing environment, that this was not the path that Glaxo would be going down. "Our competitive strengths - financial, scientific, and commercial - lead us to focus rather than dissipate our energies," he said.

Glaxo's four key corporate strategies are to maximize sales of its established products in world markets, to penetrate global markets rapidly and effectively for new group products, to bring new and innovative medicines to market, and to invest in developing markets. The business is built on three platforms: discovery, development and delivery. Dr Sykes said: "the major driving forces are the scientific environment, which predominantly influences the discovery platform, and the business environment, which predominantly influences the delivery platform. In between the two, the development platform has to absorb the pressures of both."

Dr Sykes says that despite all the changes, the outlook for the industry is good. Slower growth is expected in the USA and Europe in the next five years than that experienced in the last five years, but other regions should continue to expand, he said, adding that demographics indicate growth in demand for Glaxo's products.