Britain's biggest drug maker is expected to start moving resources away from continental Europe and into emerging markets to react to the “changed environment” on the Continent.
According to people close to the company, GlaxoSmithKline (Other OTC: GLAXF - news) is looking to make its European arm more “efficient”, which is likely to involve cost-cutting, and will look to shift resources from the austerity-hit eurozone to growing markets such as China in an attempt to boost sales.
Sir Andrew Witty, the chief executive of GSK, is currently reviewing European operations with an update on strategy expected at the full-year results on Wednesday.
The review comes in response to sales declines in the third quarter, after European governments cut medicine prices by 7pc over the period.
This followed an unprecedented 8pc fall in the second quarter, compared with around 4pc that GSK had been expecting at the start of the year. Analysts expect GSK to outline how it will achieve sales growth in the coming year, and a confirmed shift from Europe towards emerging markets could help to allay concerns.
GSK is also pinning its hopes for expanding revenue on six “sizeable” drugs, which have completed testing and been filed to European and American regulators for approval, sources said. These are two cancer drugs, two respiratory medicines, an HIV treatment and a diabetes drug.
This is an unprecedented number of products awaiting approval at GSK and it is hoped that if and when they clear regulatory hurdles, they could generate significant sales towards the end of 2013.
Sir Andrew will also be keen to show investors that GSK, having come through the so-called “patent cliff” many rivals are still grappling with, is focused on developing its R&D pipeline.
The company is committed to UK R&D, having added around 300 jobs to its workforce of around 15,000 in Britain over the past year.