LONDON--With the news that Glaxo Wellcome and SmithKline Beecham intend to merge to form the world’s largest pharmaceutical company, it is clear that genomics and bioinformatics will play key roles as the combined company expects to apply results from the human genome project to produce new drug targets. SmithKline plans to have two genomics-based products for blood pressure and eating disorders in clinical trials this year, Reuters reported.
Jan Leschly, the outgoing CEO of SmithKline, said that companies have only five to seven years to take advantage of the progress spurred by genomics. The two companies believe that joining their scientific and financial assets is the best way to stay ahead of competitors.
The merged company, to be called Glaxo SmithKline, would have a R&D budget of more than $3.6 billion, the New York Times reported. Still, stock prices for both companies have dropped on disappointment that the merger did not create larger savings and that cash saved would be funneled back into R&D instead of towards the bottom line, Reuters reported.