The company behind Sensodyne toothpaste, Centrum vitamins and Panadol painkillers plans widespread layoffs in the UK and around the world a year after being spun off from Britain’s second-biggest drugmaker GSK.
Haleon, which has 24,000 staff across 170 countries, intends to cut hundreds of roles in the UK and potentially thousands worldwide, the Guardian understands. The cuts will be made across the business.
In the UK the firm employs 1,700 people, spread across its global headquarters and its research and development labs in Weybridge in Surrey, and a manufacturing site in Maidenhead.
The company is one of the world’s biggest consumer healthcare groups and sells over-the-counter drugs, vitamins and oral care products.
Staff were briefed on the redundancies this week in a series of meetings, and a consultation process, which started on Wednesday, will close on 25 August. Some people will be offered other roles in the company. Those who are laid off are expected to leave Haleon from September.
The job cuts are part of a broader cost-cutting programme aimed at saving £300m in the next three years.
A spokesperson said: “We’ve announced internally a number of changes across our global business this week, as we continue to evolve Haleon into a more agile organisation. As we shared in March, this is part of a broader three-year programme that will help drive increased productivity across the business, ensuring that Haleon continues to deliver for consumers over the long term.
“Any decisions that involve colleagues are not taken lightly, and as we enter a process of consultation in relevant markets, we are fully committed to supporting colleagues that may be impacted,” they added.
Haleon was listed at 330p when it floated on the London stock market last July, valuing the firm at £31bn. It was the biggest European stock market flotation in a decade. The shares are now changing hands for about 312p, giving it a market value of nearly £29bn.
The group was a joint venture between GSK and Pfizer, created in 2018 when both drugmakers merged their consumer healthcare businesses, and includes brands acquired from the Swiss pharmaceutical firm Novartis. It brought together household names such as Pfizer’s painkiller Advil, lip balm Chapstick and Centrum vitamins with GSK’s portfolio including Sensodyne and Aquafresh toothpaste and Voltaren for joint pain relief, acquired from Novartis in 2015.
Under pressure from investors to break up GSK, Emma Walmsley, the chief executive, decided in 2018 to spin the consumer business off to focus on developing and producing pharmaceuticals and vaccines.
Haleon’s shares fell in early May after Pfizer said it would start offloading its 32% stake in the business, although the US firm has not sold any shares yet. A few days later, GSK sold part of its 12.94% holding, shares worth £823m, reducing its stake to 10.4%.
The chief executive of Haleon is Brian McNamara, who joined GSK from Novartis in 2015, and its chair is the former Tesco chief executive Sir Dave Lewis. The company made £10.9bn in sales last year, up 13.8% from 2021. In the first three months of this year, sales rose 13.7% to nearly £3bn.
Haleon’s main rivals include Kenvue, the consumer health business spun off in May by the US pharmaceuticals firm Johnson & Johnson, which makes Listerine mouthwash and Aveeno skincare products, and Germany’s Bayer’s consumer health division, known for Aspirin and Alka-Seltzer for heartburn and stomach aches.
Including £9.9bn of debt, Haleon’s enterprise value is about £39bn. Its performance will be measured against the £50bn offer Unilever made to GSK for the business in January 2022. The drugmaker rejected several offers, claiming they “fundamentally undervalued” the division. That offer assumed £10bn of debt.
The name Haleon was created by the merging of “Hale”, an old English word that means “in good health,” and Leon, which is associated with the word “strength”.
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