This profile is taken from the upcoming Top 100 Executives 2020 Leaders League special report.
GSK’s chief executive officer Emma Walmsley is not afraid to tackle problems head on. With the company’s share price having shown little sign of movement for an extended period, Walmsley embarked on a dramatic shake-up of the company. This has involved the spin-off of the consumer health division, which was merged with Pfizer’s consumer healthcare business last year. The move proved to be a boost for shareholders with the company’s shares rising 7 per cent when the Pfizer deal was first announced. It was reported that the joint venture would generate total annual cost savings of £500 million by 2022.
The Pfizer tie-up followed GSK’s decision to spend $13 billion acquiring Novartis’s stake in their consumer joint venture and this take full ownership of the business. This had been part of Walmsley’s strategy to improve the pharmaceutical giant’s long-term competitive performance – a key plank of this strategy has been prioritizing R&D programmes. In accordance with this approach, GSK completed the acquisition of Tesaro, an oncology-focused company based in Waltham, Massachusetts, for approximately $5.1 billion.
However, despite initial reservations, the strategy is paying off. Walmsley has been seen as taking a series of bold moves in her efforts to breathe new life into the business, but these steps have been calculated risks. The company’s 2019 annual report showed that group sales grew 10 per cent to £33.8 billion. Walmsley’s big bet on innovation succeeded – new products drove the big increase in sales with GSK’s shingles vaccine Shingrix reporting sales of £1.8 billion. In the respiratory field, there was a notable increase in Trelegy and Nucala sales, while HIV drugs Dovato and Juluca, contributed sales of £422 million.
Walmsley efforts’ to make the R&D pipeline the cornerstone of the GSK regeneration resulted in 2019 proving to be a landmark year for the company in this respect. The company secured three major approvals, eight regulatory filings for new medicines, six positive readouts from assets in pivotal studies and also progressed four new assets into pivotal studies.
"Walmsley efforts’ to make the R&D pipeline the cornerstone of the GSK regeneration resulted in 2019 proving to be a landmark year for the company in this respect"
In its 2019 annual report, GSK said that, in total, it had 39 medicines and 15 vaccines currently in clinical development, and in 2020 “we expect at least six potential product approvals”. In early 2020, GSK secured a ground-breaking agreement with the new Gates Medical Research Institute to develop the vaccine for use in low-income countries. Meanwhile, in February 2020, in an effort to support the global response to the outbreak caused by coronavirus (SARS-CoV-2), GSK formed collaborations with CEPI (Coalition for Epidemic Preparedness Innovations) – as well as other institutions and companies – to make GSK’s vaccine adjuvant technology available for the development of a vaccine.
In addition, in 2019, female representation across the organization increased and GSK was recognized by the Stonewall LGBT+ rights group as a top global employer.
Like many businesses, GSK’s took a hit due to the coronavirus – sales in the second quarter of 2020 fell 3 per cent to €7.6 billion, while earnings per share fell to 19.2p, lower than the 20.1p analysts had predicted. However, under Walmsley’s guidance, the fundamentals of the business look strong and the focus on R&D is expected to payoff. The company expects that “multiple options will be needed to prevent and treat Covid-19 and it is working to develop potential adjuvanted vaccines. In addition, the decision to make strategic investments in next-generation vaccine and antibody technologies – partly through a collaboration with CureVac – looks to be evidence of sound judgment on Walmsley’s part.