GlaxoSmithKline. Picture: REUTERS
GlaxoSmithKline. Picture: REUTERS

Bengaluru — GlaxoSmithKline chair Philip Hampton will step down after more than three-and-a-half years in the role, as Britain's biggest drug maker prepares to split its business into two.

The announcement comes a month after Glaxo's CEO, Emma Walmsley, announced her boldest plans yet — to split the company into two businesses — one for prescription drugs and vaccines, the other for over-the-counter products.

Walmsley, who took the helm in 2017, announced in December that Glaxo and Pfizer would combine their consumer health businesses in a joint venture with sales of £9.8bn, 68%-owned by the British company, in an all-equity transaction.

"Following the announcement of our deal with Pfizer and the intended separation of the new consumer business, I believe this is the right moment to step down and allow a new chair to oversee this process through to its conclusion over the next few years," Hampton said in a statement.

Hampton was paid a sum of £700,000, of which he elected to take 25% in Glaxo shares, according to the company's 2017 annual report.

He took the top job at Glaxo at a testing time — just after a profit warning in 2014 due to weak sales of its core respiratory drugs.

The Briton was tasked with helping steer the drug maker back to sustainable growth. Shares of Glaxo have, however, remained flat after rising about 17% during his tenure.

They were little changed in early trading on Monday.

Glaxo, whose consumer products include Sensodyne toothpaste and Panadol painkillers, has lagged rivals in recent years in producing multibillion-dollar blockbusters and it largely sat out a spate of dealmaking by rivals under previous CEO Andrew Witty.

Seeking to reassure investors of its financial strength, Glaxo extended its guarantee on the dividend by stating it expected to pay unchanged dividends of 80 pence per share for 2019.

Before joining Glaxo, Hampton was chair of Royal Bank of Scotland Group and J Sainsbury. He was parachuted in to help rescue RBS following its £45bn bailout during the financial crisis and led the bank through a turbulent period of transition.

Glaxo, which has been looking to buy early-stage assets and partner with companies, said it had started the search for a successor.