GSK chief ignores concerns about leadership as she sets plans

GSK chief executive Emma Walmsley has disputed concerns about its leadership, saying it is a “change agent” committed to transforming the UK drugmaker after its consumer health division split.

Under pressure from US hedge fund Elliott Management, Walmsley outlined its vision for the group, targeting sales of £33 billion by 2031 and overcoming the expiration of patents on major HIV drugs at the end of the decade.

In the next five years, the company expects to achieve annual sales growth of more than 5 percent and adjust operating profit growth of more than 10 percent.

Walmsley declined to comment on whether Elliott had seen the plan, saying that GSK “always has open ears” to current and long-term shareholders. Elliott acquired a multi-billion-pound stake in the company this year and Get some support Because of her concerns that she might not be the right CEO for GSK.

When asked if she should lead GSK after the subsidiary, despite her background in running a consumer business, she said, “I’m not going to take the time to talk about all the things I’m not. I’m an agent of change. I’m a business leader. And I’m very excited about GSK’s new plans.

The diluted GlaxoSmithKline will retain a stake in its separate consumer health division which it can then sell to fuel investment in its pharmaceutical pipeline. GSK will spin off at least four-fifths of its 68 per cent stake in its consumer health joint venture with Pfizer next year in its listing on the London Stock Exchange, but plans to hold up to 20 per cent for its “just in time” investment. in a way ‘by selling it on the open market. The company would have already received a profit of up to £8 billion from the division before the separation.’

Walmsley said the proposal was “very convenient for shareholders.”

The measure is a compromise, with some shareholders reluctant to buy back shares in an initial public offering, while others have urged GSK to raise more money for mergers and acquisitions or in-house drug development to bolster its pipeline.

The company has warned that it will cut its dividend after the quarter next year to preserve funds earmarked for investment, as it loses its consumer cash-generating unit.

The group will pay a combined dividend from GSK and consumer healthcare and is expected to be 55p together next year. The new drug company will pay a dividend of 45 pence in 2023 and adhere to a progressive dividend policy.

Shares in GSK, which tumbled 6 per cent in the past year, were up 3 per cent at 1,439 pence at lunchtime in London.

“I am fully aware that GSK stock has underperformed for a long time,” Walmsley said. “The transformation of the past four years has created a completely different platform for growth.”

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