For SmithKline Beecham 1994 Was "Successful Year"

1994 was a "very successful year in financial and strategic terms for SmithKline Beecham," the group's chief executive Jan Leschly told journalists. The environment for pharmaceutical companies is in turmoil, not just in the USA but also in Europe, with further problems expected in Italy, France and the Netherlands, he added.

Despite this, SB turned in an 8% increase in sales at L6.07 billion ($9.60 billion) and trading profits 15% higher at L1.24 billion. Because of increased interest payments, pretax profit rose only 9% to L1.27 billion ($2.01 billion), but this was still slightly ahead of analysts forecasts. Mr Leschly also pointed out that research spending had been increased 9.6% to nearly $1 billion a year, and the impact of Tagamet (cimetidine) coming off-patent had taken a serious toll.

In the USA, where Tagamet came off patent in May 1994, third and fourth quarter turnover was $50 million and $43 million respectively, compared with $155 million and $158 million in the first and second quarters. This meant an overall sales loss of more than $200 million, Mr Leschly noted.