20th November 2015
Veteran fund manager Neil Woodford has criticised the chief executive of pharmaceutical giant GlaxoSmithKline and called for a shake-up of the business.
Woodford (pictured), speaking at an AJ Bell conference, said the investment in the business ‘has been a very disappointing investment for me for a long time and the hopes that I had for that business have really been dashed over the years’, according to Fund Strategy.
He went on to criticise the structure of the business and called for management to sell off the healthcare arm of the company – he has previously encouraged Glaxo to split the businesses up to reassure shareholders of the profitability of the business.
‘I think the corporate structure is wrong, I think the business needs to focus on one or two of the businesses that it has in its portfolio at the moment,’ said Woodford.
‘I think the company should focus on what it ought to do well, which is basically pharmaceuticals and vaccines and I think it should spin or sell its consumer healthcare business and that’s what I’ve been saying for a long time.’
Woodford also criticised the Glaxo chief executive Andrew Witty who, since 2008, has been the force behind the company’s focus on vaccines and consumer products, rather than prescription drugs.
‘You know as much as I do that running a FTSE 100 company is a very challenging business,’ said Woodford.
‘Andre Witty is about running four FTSE 100 companies and he’s not doing a very good job in my view.’
The manager has called on Glaxo to separate its HIV drug business, ViiV, the consumer healthcare division, and its dermatology division Stiefel from the core medicines unit.
Despite his criticism and disappointment in the way the stock has performed, Woodford has kept the pharma company in his portfolio because he believe there is ‘a huge unlocked value in the business’ and has increased his allocation in the CF Woodford Equity Income fund to 6.12% at the end of September.