Analysts urge P&G to stick to strengths

Procter & Gamble’s (P&G) decision to pull the plug on its prescription drug research programme shows that specialist functions are best left to specialists, according to industry analysts.

Experts say that the US consumer goods giant is increasingly recognising that it should concentrate on what it does best, which is marketing, and acquire health care products at a later stage in development.

Serena Jian, over-the-counter medicines analyst at Euromonitor, says: “The job cuts from its pharmaceuticals unit at this time strengthen P&G’s strategy of shifting from research and development towards licensing and buying.”

Jian’s comments follow P&G’s announcement earlier this week that it is to axe 300 pharmaceutical R&D jobs at the $500m (&£285m) health care research facility in Mason, Ohio, that it opened ten years ago.The centre has been renamed the Mason Business centre, which has also raised questions about whether P&G will stay in healthcare. Its only billion-dollar drug is the osteoporosis drug Actonel and sales have been declining since GlaxoSmithKline launched its alternative, Boniva, last year.

P&G says that it will stay in the sector.