[Whistleblow] GSK China's Drastic Tactics: Unattainable Targets and Job Cuts Spark Employee Outcry

Whistleblower Exposes GSK China's Drastic Tactics: Unattainable Targets and Job Cuts Spark Employee Outcry

A whistleblower from within GSK China has come forward with troubling reports about the company's recent strategic changes and their impact on employees. Since October 2023, GSK China has partnered with domestic pharmaceutical company Zhifei Biopharma to promote its shingles vaccine, Shingrix, within China. Despite this collaboration, sales have plummeted rather than improved, leading to growing frustration among employees. Many have noted that the regional market for shingles vaccines is particularly challenging.

According to the whistleblower, following the integration of Zhifei Biopharma, GSK China has allegedly planned to cut up to 80 positions without offering compensation. This drastic measure appears to be part of a broader strategy to reduce costs.

Key Takeaways

• Collaboration and Sales Decline: GSK China's partnership with Zhifei Biopharma to promote Shingrix has not yielded the expected sales growth. Instead, sales have decreased, exacerbating employee concerns.
• Job Cuts and No Compensation: The whistleblower reports that GSK China plans to eliminate 80 positions without compensation, reflecting a strategy to cut costs.
• Unachievable Performance Targets: In a recent move, GSK China has drastically altered the commission structure for sales representatives handling the HPV vaccine and Shingrix. Previously, the bonus split was 7:3, but it has now been changed to 2.5:7.5. While this adjustment seems to offer higher potential bonuses, it comes with a significant catch: representatives must achieve a 70% performance target across large regions to qualify for any bonus. Given that no region has been able to meet this target, it effectively ensures that almost no one will receive their bonuses.
• Employee Dissatisfaction: These changes have led to significant dissatisfaction, with employees feeling overworked and undercompensated.

Analysis

The whistleblower's revelations paint a picture of a company under strain, trying to navigate a challenging market with aggressive cost-cutting measures. The partnership with Zhifei Biopharma was intended to bolster Shingrix sales, but the reality has been far from the expectation. The decision to change the bonus structure appears to be a calculated move to reduce payouts, indirectly encouraging employees to leave voluntarily, thereby minimizing the need for direct layoffs.

This strategy might be seen as a broader trend within the pharmaceutical industry, where companies are facing intense pressure to perform amidst stringent regulatory environments and competitive markets. By setting unattainable targets, companies can reduce their compensation liabilities while maintaining the appearance of offering lucrative incentives.

Did You Know?

• Zhifei Biopharma's Role: Zhifei Biopharma is not new to exclusive deals. It has previously secured the exclusive rights to distribute Merck's HPV vaccine in China.
• Shingrix Sales Targets: The exclusive agreement between GSK and Zhifei Biopharma set ambitious sales targets for Shingrix, aiming for minimum procurement amounts of 34.40 billion yuan in 2024, 68.80 billion yuan in 2025, and 103.20 billion yuan in 2026.
• Industry Practices: The practice of setting high-performance targets to reduce bonus payouts is not unique to GSK China. It reflects a broader industry practice where companies adjust performance metrics to align with financial goals.

The whistleblower's account highlights significant issues within GSK China's strategic approach, raising questions about employee welfare and the effectiveness of their market strategies. As the company navigates these challenges, the impact on its workforce and overall market performance remains to be seen.

Disclaimer: We are unable to verify the identity of the whistleblower who provided this information via email, and we cannot be held responsible for the accuracy of the news reported. If the information is found to be false, we will promptly remove the article.