Cincinnati consumer products company Procter & Gamble is working with investment bank Goldman Sachs to findÂ buyers for its prescription drug business or ways to exit the business, sources close to the matter told Financial Times last week.
The maker of Gillette razors and Crest toothpaste has been working to focus on high-growth businesses andÂ get out of those that are not core to its consumer products mission, FT said.
P&G’s decision is one of only a few by Ohio companies to contract rather than to grow, even during the recession, said Tony Dennis, president and chief executive of BioOhio, the state’s bioscience company development organization.
That’s the downside to it,” Dennis said last week before leaving for Washington for two days of pitchingÂ the Ohio bioscience industry to policy makers. “The upside is, [the decision] will enhance their OTC business. They’re much more skilled with the OTC business, anyway.”
Procter &Â GambleÂ sells many over-the-counter remedies, such as Pepto-Bismol (nausea) and Prilosec (heartburn). The company’s prescription drugs have focused on women’s health, and on gastrointestinal and musculoskeletal problems.
The company’s health care division, which includes its pharmaceuticals business, had $14.6 billion in sales and $2.5 billion in net earnings last year, according to Financial Times. P&G told that newspaperÂ that its pharmaceuticals unit accounts for global sales of more than $2 billion.
P&G shares hit a 52-week low of $52.21 on Feb. 2 after the companyÂ reported disappointing second-quarter results and lowered its full-year expectations. In December, A.G. Lafley, P&G’s chief executive, told analysts his company had stopped investing in new drug development andÂ would consider selling some of its key drug brands.
Other stories worth a read:
- UnitedHealth and IBM test health care plan (New York Times)
- Trustees OK $30 million to kick off OSU med center expansion (Columbus Business First)
- Personalized medicine using genetic testing still far off(MedPage Today)
- Grassley would add hospital scrutiny to stimulus bill (WSJ Health Blog)
- Two simple ways to revitalized Seattle biotech(Xconomy Seattle)
- Summa, doctors would pay $4.5 million per year to lease Cuyahoga Falls General (Akron Beacon Journal)
- Academic hospitals’ investments decline sharply (Chicago Tribune)