According to a notification on the Dhaka Stock Exchange (DSE) website yesterday, the record date for the EGM is September 19
GlaxoSmithKline (GSK) Bangladesh has called an Extraordinary General Meeting (EGM) regarding the closure of its pharmaceuticals unit. The EGM will be held on October 14 at 11.00am. The meeting venue is yet to be announced.
According to a notification on the Dhaka Stock Exchange (DSE) website yesterday, the record date for the EGM is September 19.
UK-based pharmaceutical giant GSK has been operating in Bangladesh for the last 50 years. However, the decision to shut down the company’s factory in Chittagong was taken at a meeting of its board on July 26 this year.
GSK Bangladesh Managing Director Nakibur Rahman said the company would continue its consumer healthcare business in the country, despite the closure of its pharmaceuticals unit. Consumer healthcare products by GSK include Horlicks, Sensodyne, and Glaxose-D.
“All of our medicine is substitutable with generic variants, so patients should be able to access a range of suitable alternatives,” he added.
Nakibur said further: “GSK will run pharmaceuticals in our emerging markets region as an integrated operation, putting in place the right commercial structure in markets to deliver a sustainable growth ambition.”
At the EGM, GSK Bangladesh will seek approval from shareholders for the pharmaceutical factory closure. The decision to shut down the factory would affect about 1,000 employees, the GSK Bangladesh managing director added.
The state-run Investment Corporation of Bangladesh owns a 12% stake in GSK Bangladesh, while 6% of shares are held by the public and other institutions.
Globally, GSK’s pharmaceuticals business has seen sluggish growth in recent years. The company has unveiled a new restructuring program, to deliver annual cost savings of £400 million by 2021.
GSK employees seek govt intervention
Over 1,000 employees of GSK Bangladesh have sought government intervention to stop the closure of the company’s factory.
GSK Bangladesh Employees Union Secretary Md Azam said: “There is no apparent reason to close a profitable business. The company cannot take the decision to shut the unit unilaterally, keeping the government in the dark, as various government entities hold a stake in the business.”
He added that the abrupt decision to close the factory would hit 1,000 permanent and 400 part-time workers of the company very hard. The GSK Bangladesh Employees Union secretary further said that the closure of the factory would deprive the government of a huge amount of VAT, and patients would lose access to quality pharmaceutical products.
Refuting the claim that GSK Bangladesh has been making a loss, Md Azam said: “The factory made a profit of Tk66 crore last year. The company gave Tk55 as dividend against each share worth Tk 10, and paid Tk 199.44 crore to the government as VAT and tax. From 2013 to 2017, the company has made a net profit of Tk 351.79 crore, and given around Tk1,000 crore to the government exchequer.”