KENYA – Pharmaceutical giant GlaxoSmithKline (GSK) has announced that it is pulling out of the Kenyan market in 2023 and its factory will remain open under its stand-alone affiliate Haleon amid the global overhaul of the multinational.
Its exit follows disappointing sales for many multinational pharmaceutical companies in the region in the face of competition from cheaper generics from India and locally manufactured medicines.
In July, the multinational healthcare firm spun off the consumer healthcare business and listed it separately as Haleon in shake-up to focus on the lucrative prescription drugs and vaccines business, which has brands like Augmentin, Zentel and Ventolin.
GSK, which mainly deals in prescription drugs and vaccines business, has made a bigger impact in Kenya with its malaria and HIV/AIDS drugs and antibiotics.
The firm said in a press release that it was exiting Kenya as it plans to adopt a distributor-led model to supply the country with its products.
“We will continue to supply our needed medicines and vaccines in Kenya, and we will work with our distribution partners towards a smooth transition in 2023,” the firm reassured.
GSK explained that its operation at Nairobi’s Industrial Area plant will remain open under Haleon, a consumer healthcare venture that deals in products like Sensodyne and Panadol, while noting that the facility will continue to make and sell over-the-counter products from Nairobi.
“The announcement we made was that for our GSK business, we would move to a direct distribution model. This means that instead of having a GSK commercial operation in the country we will supply our medicines and vaccines through a third party,” the firm said.
The manufacturing facility in Kenya is operated by Haleon and GSK was importing medicines and vaccines, whose sales were being handled by its management office, which will shut down.
The review of the Kenya operations comes nearly five years after the pharmaceutical giant announced it was cutting back operations in Africa.
It stopped marketing medicines to healthcare professionals in 29 sub-Saharan African markets but continued running local operations in Kenya and Nigeria while retaining representative offices in Cote d’Ivoire and Ghana, according to a newspaper article published by Business Daily.
“Yesterday, we informed employees in Kenya that we will move to a direct distribution model and our operations will be transferred to third-party distributors,” GSK said in an e-mail response to Business Daily.
Furthermore, healthcare stakeholders have expressed concerns about GlaxoSmithKline plans to shut down its commercial operations in Kenya next year as the move will cause job losses.
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