Glaxo freezes sales force despite new drug launches
GlaxoSmithKline will not increase the size of its sales force despite launching five new drugs in the U.S. this year, the company's chief executive Jean-Paul Garnier told reporters yesterday.
"We think there is no point in raising the stakes in terms of the size of the sales force," Garnier said during a post-results conference call. "It's an expensive way to advocate out products to the physician."
Garnier has said in the past that inflated sales forces are characteristic of the pharmaceutical industry's ongoing marketing "arms race," which is chipping away at margins for all companies.
Earlier in the month, Pfizer announced plans to reorganize its sales force but stopped short of reducing staff numbers.
Glaxo yesterday reported a 16 percent increase in its first quarter net income to $2.29 billion, from around $1.9 billion a year earlier.
The company also signed a consent decree yesterday with the FDA, which had withdrawn two of the company's drugs – antidepressant Paxil CR and diabetes treatment Avandamet. The drugs are expected to be back on the market by mid-year.
FDA officials seized batches of the drugs from plants in Tennessee and Puerto Rico in March because of manufacturing violations. Glaxo had earlier recalled batches of the two drugs but its failure to recall all of the affected product led to a federal seizure to halt distribution until the problems were corrected, the FDA said.