Please ensure Javascript is enabled for purposes of website accessibility

GlaxoSmithKline Cutting Up to 720 Jobs at European Vaccine Facility

By Eric Volkman – Feb 6, 2020 at 5:16PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The workforce reduction is one of the moves being made to prepare for the pharmaceutical company's upcoming split into two entities.

In advance of its split into two companies, pharmaceutical giant GlaxoSmithKline (GSK 0.24%) announced it will cut as many as 720 workers from its vaccine production facility in Belgium. In addition to these layoffs, which are part of its two-year restructuring program, the company said it will decline to renew the contracts of 215 temporary employees.

Most of the employees losing their jobs work in manufacturing, research and development, and global support positions. The majority are managers.

GlaxoSmithKline office building in the UK

Image source: GlaxoSmithKline

The decision to trim its vaccines workforce may appear counter-intuitive. It has been a high-growth segment for GlaxoSmithKline lately, thanks mainly to its next-generation shingles vaccine Shingrix (responsible for around $2.3 billion in sales in the company's fiscal 2019 -- more than double the 2018 result).

The upcoming split will cleave GlaxoSmithKline into two companies, one focused on consumer products and the other on the development of branded drugs.

Currently, the company's consumer health segment is combined in a joint venture with that of Pfizer (PFE -0.91%). The uncoupling of the Pfizer/GlaxoSmithKline venture was expected; when it was first announced in the summer of 2019, GlaxoSmithKline said it wanted its part to de-merge within three years.

The company said it will devote more capital to research and development activities at the stand-alone branded drugs company.

"As GSK increases its investments in R&D and the launch of new products, this program aims to strengthen a common approach to R&D between the pharmaceutical and vaccine divisions, by improving the allocated funding and decision making on which vaccines or drugs to develop," it wrote in the French-language press release announcing the layoffs.

GlaxoSmithKline, a top pharmaceutical stock, closed Thursday down 2%.

Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

GSK Stock Quote
$29.43 (0.24%) $0.07
Pfizer Inc. Stock Quote
Pfizer Inc.
$43.76 (-0.91%) $0.40

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.