GlaxoSmithKline Loves Government FearmongeringFriday, October 9, 2009
The Pharmaceutical Daily never disappoints. Today’s cover story is about GlaxoSmithKline putting all its bets on the flu – seasonal, bird, swine, whatever. Thanks to the US government – and other governments – transferring billions of taxpayer dollars to Big Pharma’s war chest, pharmaceutical giants like Glaxo have the financial means to gobble up smaller flu-vaccine makers and adjuvant manufacturers.
The company has spent more than $3.2 billion on research, acquisitions and extra manufacturing in anticipation of a flu pandemic. Ranging from vaccines and antiviral drugs to medicated face masks and diagnostic tools, Glaxo’s portfolio sets it apart from rivals that have tended to focus on one aspect of flu-fighting, such as Sanofi-Aventis SA, which makes vaccines, and Roche Holding AG, which makes the antiviral drug Tamiflu.
“Short of putting beds in the labs, we are throwing just about every resource we’ve got into this situation,” says Chief Executive Andrew Witty.
Is there anyone who doesn’t believe that this pandemic – which still has not materialized – was declared for the purpose of executing a major profit coup for Big Pharma?
Glaxo’s strategy reflects how drug makers are pushing beyond prescription pills as valuable patents expire. The company has faced competition from makers of low-cost generic drugs on several of its big sellers, including antidepressant Wellbutrin and epilepsy drug Lamictal. A business built on vaccines is less likely to be undercut by low-cost producers: Vaccines are complicated to make, factories are expensive to build and maintain, and demand for flu shots can be fickle.
Mr. Witty believes that with governments becoming more concerned about pandemics, the business has staying power.