SmithKline Beecham to close production plants
15 Jan 2000
The pitfalls of trying to predict future trends have rebounded upon SmithKline Beecham. Forced to sell off its pharmacy benefit management (PBM) operation, Diversified Pharmaceutical Services, the company is embarking on a cost-containment programme which will see some 3000 jobs lost.
SKB paid £1.6billion for Diversified in 1994, expecting that US health reforms would force hospitals to use PBMs to source their drugs. However, the reforms were scuppered, and Diversified has become surplus to requirements. SKB is to sell the business to Express Scripts for £437million.
To help offset this, the company has announced that it is to `focus on selected manufacturing plants to create global centres of excellence while selling or closing other non-essential facilities.'
