Skip to main content

Business and Markets

More Movements at the Top of GSK

GlaxoSmithKline has been having more than its share of ups and downs over the last few years. In 2014, they moved a lot of assets out of oncology, as part of a general rearrangement into higher-volume lower-cost areas. That was a pretty bold move – give management credit for not being timid, at least – and there were plenty of out-and-out cutbacks as well (such as the closure of the RTP site).

Not all of these moves were popular with the company’s investors, and there were calls for CEO Andrew Witty’s job. Those wishes came true in March of 2016, when Witty announced that he would step down as CEO, followed by their head of the vaccines division (and former R&D head) Moncef Slaoui. Emma Walmsley, coming in through the Consumer Care part of the company, moved into that role, and officially took over this year. Back in July, the company announced a shakeup in R&D, at least some of which seemed to be a further admission that the previous strategy just didn’t seem to be working out. Witty and Slaoui have both taken the traditional route into venture capital and sitting on the boards of various other companies (although in Slaoui’s case, one of those board appointments seemed to last only about ten minutes, for some reason.

Patrick Vallance had taken over from Slaoui as R&D chair in the 2014 rearrangement, but he’s now heading out the door as well. And his replacement (to some surprise in the industry) is Hal Barron, ex-Genentech/Roche and now ex-Calico, the Google anti-aging startup. It’s been hard to figure what’s going on over at that last one over the last couple of years, or in general, but Barron’s departure has to rank as interesting news. Who will the Google/Calico organization bring in as a replacement?

An ex-GSK friend said to me “It’s kind of odd that Witty came from pharma and wanted to emphasize consumer, whereas Walmsley has come from consumer and wants to emphasize pharma”, and he’s got a point there. It’s going to be hard not to think of the last ten years or so at the company as something of a lost decade. There have been successes, but not nearly as many as there were supposed to be, and a number of big ideas from that era have been unwound. The R&D organization that looked so much to the executives like it needed to be shaken up probably doesn’t look as bad in retrospect, either. Too late for that.

47 comments on “More Movements at the Top of GSK”

  1. Peter Kenny says:

    Stop being so negative, Derek, they gave us property forecast index (PFI), inspired Mothers Against Molecular Obesity (MAMO) and will surely harness AI to make drugs that are cooler and shinier that everybody else’s.

  2. b says:

    I set the over/under for Agilist’s comment at 9:15am EST

    1. Dr Zoidberg says:

      I was under the distinct impression that Agilist was either Slaoui himself or his personal assistant. With Slaoui gone I expect Agilist’s posts to stop as well. This is a bit disappointing since they were so hilariously obvious that they were fun to point and laugh at.

  3. Mister B. says:

    Quick question. What does these rotations on the top of a world company such like GSK do on the daily routine in R&D ?

    From outside this world, it seems that more uncertainties are coming (Will my project be closed tomorrow ? Will my site be closed etc.).
    But are there positive outcomes too ? (Except for investors 🙂 )

    1. Esprit says:

      In some ways executive management is irrelevant because when it comes to R&D they’re usually flying by the seat of their pants, in spite of their “we’ve got it right this time” speeches. Clearly this has been the case of GSK. This is generally understood by the scientists in the trenches who have a first-hand appreciation for the uncertainties of drug discovery, as well as the caveats of projecting downstream commercial development and profits. Research scientists tolerate management’s capacity to pull things out of thin air and give nifty TED talks about it – then they get back to work. Corporate codswallop is understood to be a managerial ritual, providing confidence in the face of uncertainty. GSK may be better viewed as a financial institution, rather than a research organization.

      If you have a low tolerance for uncertainty, drug discovery isn’t a good fit. However, the uncertainly of whether your project, department, site, or job will be canned does not promote productivity. GSK will have to figure out how to run R&D differently from the Hunger Games. But it’s hard to see management reducing its codswallop.

      Agilist come hither.

      1. Mister B. says:

        Thank you for your answer !

        I may be way too naive, but I still want to take part of the drug discovery process ! (My time as an IP at GSK was an oustanding experience !)
        I always thought that management was listening scientists and more important, trust them. Reality showed me I was a fool to believe that ! 😉

  4. a says:

    Walmsley is Wittys way of continuing to push the high volume angle. She was being groomed by him as soon as she was hired.

    What all of these science driven companies need is someone who can protect important projects from being cut while still keeping Wall Street happy. Witty was ok at that, not great. They definitely ate their seed corn in 2008. If they hadn’t laid everyone off, maybe they’d have had enough resources to be playing in the big leagues with a pcsk9, a factor x, or an IO drug.

    Oh, wait, they used that money to buy Sirtris. Great idea.

    1. Chrispy says:

      Sirtris ranks as among the most boneheaded moves in recent Pharma memory. Everyone associated with that should have been shown the door, including those who knew it was terrible and didn’t want to rock the boat by saying so.

    2. MCS says:

      “What all of these science driven companies need is someone who can protect important projects from being cut while still keeping Wall Street happy.”…Duh.

      What drug discovery/marketing looks like from the outside is a drunkard’s walk through a multidimensional space with the upper management as the drunk.

      It follows that investing in it is like cow-pat bingo. You win if they leave a pile on your square. Don’t work in investor relations either.

      Not to disparage the people actually doing the work, we all hope that there will be something to pull us back from the brink when we need it.

  5. biotechtoreador says:

    Really a classic that shows GSK’s commitment to excellence in science…..the irony of it being against drug use (albeit illicit) is just icing.

  6. Barry says:

    Barron’s expertise is mostly Oncology. Does this signal that GSK regrets selling off it’s Onco small molecule portfolio? Or does it conceive that Onco is not a small-molecule problem? And it’s reported that he’ll stay in the Bay Area

  7. Peter S. Shenkin says:

    Re. Sirtris, the Wikipedia article on Resveratrol made me giggle. Quoting:

    Heart disease[edit]
    There is no evidence of benefit from resveratrol in those who already have heart disease.[10] A 2014 Chinese meta-analysis found weak evidence that high-dose resveratrol supplementation could reduce systolic blood pressure.[11]

    As of 2016, there is no evidence of an effect of resveratrol on cancer in humans.[12]

    There is no conclusive human evidence for an effect of resveratrol on metabolism.[13][14]

    There is no evidence for an effect of resveratrol on lifespan in humans as of 2011.[15]

    1. cancer_man says:

      A study published early this year showed that 50 m of resveratrol improved the efficacy of an ACE inhibitor by 20%.

      1. SedatedFMS says:

        Is it a Cyp-inhibitor? Reduce clearance, prolonged exposure etc?

  8. Anon says:

    I am a medicinal chemist, I have been watching the performance/research of all major Pharmaceutical companies in the USA and Europe. Of all, I rate GSK as the worst performer! They have been burned too frequently, too many changes in their top staff but at the end of the day with nothing to show for! Their only claim to fame is Zantac, then of course AZT (thanks BW!). Mostly hype line!

  9. Petros says:

    Anon is very selective in his assessment.

    GSK’s respiratory portfolio and innovations in the 5-HT1a and 5-HT3 field have been highly significant as well as lucrative, with a higher degree of innovation involved than that underlying Zantac.

    1. Anon says:

      @ Petros-I was the anon @ 11.29 who opined…But, Petros, my point was people showed up at the top and took turn to plunder the company and left it in a bad shape in a iterative manner. If you were to analyze it today, you know that wrong decisions have been made for 20+ years. You got to hire the right cook, if you want to serve people and tasty food, or else disaster looms. I repeat again GSK was ruined by people and not by science. That said what good is science if you cannot commercialize the drug?

  10. Me says:

    Top commenting people….I wonder if our GSK cheerleader friend has become disillusioned with the company, or indeed, been a victim of a recent reshuffle?

    1. b says:

      His/her’s was the first comment in Derek’s last post on 7/28, so must’ve been pretty recent if so. Not controlled by Witty, but maybe Slaoui or Vallance?

  11. SevenHabits says:

    Hal Barron’s record speaks for itself so no need for superlatives: a great appointment that has been greeted with a frisson of excitement across GSK, albeit tinged with a touch of wistfulness at Patrick’s imminent departure. Patrick has left a great legacy that Hal will be well-placed to build upon to take GSK to the next level. Patrick himself will take up a very prestigious scientific advisor role in the UK at a critical time in the country’s history with Brexit looming. This change at the top of R&D ushers in another exciting turn in the GSK journey.

    1. Me says:

      YAAAAAYYY!!!!!!!!!!! *CLAP* *CHEER*

    2. more bilge at the top says:

      YES!!! The legend continues!

    3. Emjeff says:

      I knew you hadn’t left us, Agilest!

      Patrick Vallance was a disaster for GSK. An academic with no pharma experience at all, he also did not care to learn the business. Sirtuis was purchased for an insane amount of money against the advice of his scientists, who told him there was nothing there. There wasn’t. He insisted on running two giant cardiac outcome trials on darapladib at the same time, with no prespecified interim looks, which would have allowed the company to pull the plug early on what ended up to be a decidedly ineffective therapy. The failure of darapladib is what doomed the NC site – notice that nothing happened to ol’ Patrick. I for one am glad to see him go into a meaningless government policy job, where he can bumble and mumble his days away without hurting anyone.

    4. Barry says:

      help me out here. Is this the official GSK press packet, or a satiric post? It’s so hard to tell them apart this year.

    5. Some idiot says:

      You are late…

    6. Anonymous says:

      Seven Habits? That makes me want to sharpen my axe …

  12. mallam says:

    There has been so much enthusiasm on the most reshuffle in the hearts and minds of shareholders, that the stock made a one day small uptick, and then continued on it’s slide that became more steep after the discussions about GSK’s possible interests in bidding for Pfizers OTC portfolio, citing risk to cuts in dividend and taking on more debt. Yes, some might be response to the proposed tax plan in the US, but not all other companies have been so steep.
    On the dividend, I’ll come back to an oft stated concern by UK retirement investment funds having GSK stock because of the dividends, and their concerns if the return would be cut. Yet, the dividend return today looking forward would be over 5.5%, something hard to maintain when in a capital intense activity as new drug R&D. And even at this projected return, shares continue to be dumped.

  13. Diver Dude says:

    Well, it *sounds* like Agilist…

  14. johnnyboy says:

    He sounds a bit like he’s phoning it in, though – no sign of any paradigms shifting, no 360-degree thinking, synergies or cross-pollination. Could he be depressed ? I’m worried.

  15. MoMo says:

    I hear they are going to turn the Tres Cantos outpost into a Bed and Breakfast or an Air BnB.

    Any truth to this?

  16. myma says:

    Well, since all the usuals are showing up, here is my usual addition to this perennial topic:
    As an ex-GSK, the decision to take the package and leave took maybe a half second. I’m not disgruntled at all, it was a great decision.

    1. Overthetop says:

      You lucky dog! I prayed for a package, but they wouldn’t give me one. Instead, I managed to not get laid off for at least two rounds (or was it three?). Eventually I gave up waiting and just quit to pursue a different career path.

  17. Chrispy says:

    In related news, GSK achieved dead-last ranking in the IoD Corporate Governance assessment of companies in the UK:

    (SevenHabits really has to be Agilist — frission of excitement? Thanks for the laugh for the day!)

  18. anon2 says:

    Not a fan of Calico/Google alumni. Grandeur-ize and handwave your story to get in, do nothing, leave.
    But back on topic, its an odd state when you see boards of a company of similar size to GSK hire a ketchup salesman to run it all. Really shows these top positions are not directing the ship. just hoisting a flag.

  19. FormerLabRat says:

    It’s hard to see how Barron will be able to effect the much-needed changes in Upper Merrion, let alone Stevenage, from afar in the Bay Area. What is he going to do with PV’s “academic superstar” appointments and the empty suit insiders who have thrived in a culture that values loud talkers and “let’s jump on the latest technology bandwagon” types who have a stranglehold on so much of R&D? He definitely has the credentials and the vital industrial experience that PV lacked but never acknowledged, probably even to himself, that he lacked. Is that enough though to revive R&D? I really hope so because GSK has lots of excellent scientists who are committed but deeply frustrated by the types who get promoted and the leadership styles they embrace. Every re-organization that I have witnessed at GSK was top-down where the philosophy was “appoint big names at the top and expect them to drive change downwards”. I think this has failed miserably and no matter how good Hal Barron is, it will fail again without meaningful change from the bottom up. I hope he listens to those doing the nuts-and-bolts science that discovers and develops drugs instead of those who spot “MBA Speak”. The triumph of hope over expectation, I fear!

  20. braindoc says:

    You are all too kind to the dynamic duo (Slaoui/Vallance). Let’s recount some of their most interesting moments… a) Purchase of Sirtris against the advice of internal experts who cautioned about the lack of effect of the compounds (later replicated by Pfizer) and the welcome mat that was shown to the two used car salesmen that came with Sirtris and were later booted from GSK for selling a food grade version of the same stuff they sold to GSK. b) Human Genome Sciences and the debacles with Benlysta and later Darapladib (the former being hyped as the next best thing for SLE and the latter being run by an academic with no prior industry experience and an ego that precluded learning his job). c) Genmab and the 5 year odyssey to figure out whether or not do do something with ofatumumab in the MS field (on/off so many times it felt like a strobe light was being pointed at the team). d) The ten year experiment with genomics to the tune of $750M (an unverified cost) that yielded nothing. e) The destruction of one of the best neuroscience discovery and development groups with one of the best pipelines because MS was just too uncomfortable with CNS and locked into a “if you can’t measure a titre, its not real” mindset. f) Let’s not forget the scandal in GSK-China that included unreported experiments, fraudulent data, scientific misconduct not to mention bribery and extorsion despite plenty of warnings that things were out of control there.

    Its sad to see what has happened to GSK…but I can only hope that the many good and dedicated people who are still there can finally get decent leadership.

    1. FormerLabRat says:

      Braindoc, I think your analysis is largely correct but unless we learn from the past, we are doomed to repeat it. I think MS & PV did what they thought was best but it clearly didn’t work as intended. I think they have been rightly pilloried for their management styles and the types of people and practices that they promoted. However, I believe there is still a lot of talent and good science at GSK despite the dreadful blunders of past management that could serve Hal Barron very well. My concern is that the management culture will frustrate his best efforts if he does not tackle this head-on and soon. Quite a few very good scientists with a lot of experience have been leaving recently and if things don’t improve, this trend may accelerate and recruitment of headline-grabbing external talent, no matter how good, will not be able to counter this hollowing out of the R&D core expertise.

      1. Old says:

        “My concern is that the management culture will frustrate his best efforts..” Translated…the cult of JB..

        1. FormerLabRat says:

          Yeah, let’s replace chemists with data scientists and we’ll discover & develop a new drugs in 12 months

  21. NH_chem says:

    GSK- another lost at sea Big Pharma. It is incredible to me the number of Big Pharma’s that continue to “rinse lather, repeat” in order to prop up stock prices and try to keep investors happy. Meanwhile, the bureaucracy within these companies continues to stifle growth.

    When a Big Pharma tells a CMO that it will take 1 year to get them into their system, that is a problem. When a Big Pharma has sourcing people that only use Google or agents to find molecules for projects, you have issues. My friend who is in business development recently told me of a story where a Big Pharma wanted to scale from 100 g to 40 kg and when the CMO came back with 33 kg of material, the Big Pharma said “we told you we needed 40 kg”. Then how about some process R&D or, if you don’t want to do that, then order 60 kg since you have to assume there will be an issue going from 100 g to 40 kg.

    Not much else to say……..

  22. RTPeedUpon says:

    “Lost decade” is correct. Apart from the R&D and bribery/sales ethics disasters, these senior execs. couldn’t even run their factories properly (or honestly). Many good people lost their jobs in the wake of the Cidra, PR factory consent decree and other FDA failures. Viehbacher jumped to Sanofi, and the head of QA retired with a nice bonus package. The corporate kleptocracy and corruption was truly stunning. We make fun of corruption in the third world, but ignore the sheer breadth of consequence-free criminal behavior in our own system. What a complete shame.

  23. anonymous says:

    Just the other day, banners for the new leasing company went over the old GSK signs at the RTP site. Sad.

  24. HardTruths says:

    Coming to this late: Vallance deserves some credit and certainly more than he’s likely to get on this forum! He’s blamed for getting rid of so-called “good people” but, perhaps I’ve missed it, but where did all these “good people” go? Have they discovered breakthrough drugs? Are they running unicorn start-ups? More likely they’re trying to sell themselves as “consultants”, they’ve disappeared into academia or they’ve retired. Barron needs to get stuck in, reduce bureaucracy, clear out deadwood and bring in some genuine talent. It’s a big ask, something like trying to turn round the Titanic so he’s got his plate full.

    1. Me says:

      That was discovered by ‘good people’ that Vallance got rid of.

    2. exGlaxoid says:

      There were a number of scientists at RTP and other sites that actually discovered drugs that made it to the clinic. Most were laid off in many of the cuts, but some even got as many as three drugs to market before being axed. So the “good people” were mostly downsized, while the upper management that brought us Sirtris and so many other bad ideas got bonuses.

      Much of the nearly $10 billion in fines, fees, costs, bad investments, etc were clearly related to decisions made by upper management, often while the people below them clearly said pointed to data showing a better way. The top R & D people also spent millions building “chemical factories” where automation was to make chemicals with little intervention, even after several test runs which ended in disasters (I saw a prototype in person and stated that the complex equipment would be clogged in a week and it was). Those buildings were a huge loss, as were most large “investments” made by upper management from ~2000 on.

      If they had simply left the scientists at the former GW sites alone, and wasted less money, I have little doubt that GSK would still be doing far better. That is where the oncology portfolio (the one they sold), the asthma drugs, Zofran, Imitrex, and the antivirals came from.

      I wish Emma the best in resurrecting GSK back into a respectable company, but I don’t expect much. Thankfully I sold most of my shares a while back before they went lower.

    3. a says:

      Yes, there’s a whole school of fGSKers who went out and did really great things, both at other, better-managed big pharma cos like Merck, BMS and Novartis; and also at small cos, like Trevena and Cardioxyl.

      Some of the people who survived the 2008 Sirtris Slaughter were good workers, and continue to do the best they can there – but they undoubtedly would have brought more value to the Company if they’d had the same resources and people they’d had access to in 2006. PV and MS just didn’t know what they were doing, and they fouled the water there for 10 years and counting. And the reason they did this was to buy Sirtris, which they should be excoriated for basically forever. What’s the opportunity cost of that purchase, given that they had to downsize to fund it? What did they cut in order to fund that? GSK has nothing in IO, the biggest innovation in pharma since statins.

Comments are closed.