VOL. 123 | NO. 222 | Wednesday, November 12, 2008
GlaxoSmithKline Plans UK Plant Closure, Job Cuts
By EMILY FLYNN VENCAT | AP Business Writer
LONDON (AP) - British drug maker GlaxoSmithKline PLC said Tuesday it is planning to close one of its English plants, which employs 620 people, by 2013 because the majority of drugs made at the plant are losing their patent protection and facing generic competition within a year.
The world's second-largest pharmaceutical company by revenue said that 60 percent of the production at its Dartford plant is of two drugs: Lamictal, which is used to treat epilepsy and bipolar disorder, and Valtrex, which is used to treat herpes.
Lamictal's patent expired earlier this year and generic competition for the drug will hit U.S. pharmacies in July. Valtrex's patent will expire next year.
As a result, GlaxoSmithKline's sales of the two drugs are set to dry up over the next several years, and so the company said it makes economic sense to shut the plant down by 2013.
"The proposal is no reflection on the professionalism and commitment of Dartford employees, but that of the fiercely competitive environment in which the pharmaceutical industry operates," said Joe Foley, director of GlaxoSmithKline's Dartford plant.
The announcement comes less than a week after the drug maker announced that it is reducing its U.S. sales force by 1,000 to cut costs amid growing competition from generic drugs, as increasing numbers of the company's profitable patents expire.
GlaxoSmithKline, the maker of antidepressant Wellbutrin and Requip for Parkinson's disease, currently employs around 100,000 people worldwide.
U.S.-traded shares of GlaxoSmithKline rose 25 cents to $37.85.
GlaxoSmithKline has a plant in Memphis.
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