GlaxoSmithKline announced on Wednesday that it is taking a new approach to R&D and increasing its expectations for the rest of the year on the back of strong second quarter results.
In what will be a major restructure, the pharma giant is set to cut $523 million in annual costs and use the savings to launch new products, having booked group sales of $9.6 billion for the period (of which pharmaceuticals sales accounted for $4.2bn).
The company sees savings opportunities through “supply chain optimization and reductions in administrative costs.”
Performance was reported as strong thanks in part to an extremely successful period for the company’s vaccines division with a revenue jump of 16 per cent. Its new Shingrix (shingles) vaccine alone is expected to bank up to $854 million by the end of the year, while sales of Ellipta products, including Trelegy, saw £669m in revenue (+20 per cent CER).
GSK’s new stance on R&D will see it focusing on science related to the immune system, the use of genetics and investments in advanced technologies.
A newly announced strategic collaboration with genetic testing company 23andMe will seek to take advantage of novel genetic insights to enhance selection of drug targets and clinical development of new medicines.
Other assets expected to launch in the next two years include two treatments for HIV and GSK’s advanced oncology treatment. The U.S. FDA also approved Krintafel (tafenoquine), the company’s radical cure of P. vivax malaria, in July.
“Innovation is the first of our three long-term strategic priorities I set out for GSK last year,” said GSK CEO Emma Walmsley.
“Improving the performance of our Pharmaceuticals business and strengthening our R&D pipeline is fundamental to this. Today, we have announced the start of a new approach to R&D which aims to capitalise on the assets we have in our promising early-stage pipeline and build the next wave of growth for GSK.”
The company is also investing in advanced technology platforms, such as machine learning, to support interpretation of genetics, as well as in functional genomics to validate potential targets, applying techniques for gene modification such as CRISPR technology.
GSK also plans new investment in computational design, automation and new capabilities to assess the indication potential, selection, sequencing and management of evidence generation for new assets over the lifecycle.