Glaxo, SmithKline merger creates new DTC ad giant

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The $70 billion-plus merger of Glaxo Wellcome and SmithKline Beecham, announced Jan. 17, will likely create the biggest spender in direct-to-consumer advertising as well as the world's largest drug company. Glaxo has been one of the most aggressive DTC spenders on products such as migraine drug Imitrex, while SmithKline has recently stepped up efforts behind antidepressant Paxil and new diabetes drug Avandia. Combined spending for the two companies topped $420 million in 1998, a figure that includes SmithKline's fleet of over-the-counter products.

Glaxo SmithKline will have the dominant market position in smoking-cessation products, with Glaxo's Rx Zyban and SmithKline's Nicoderm CQ and Nicorette, which together generated some $135 million in ad spending in 1998.

Though the two companies have a range of agencies, they share Jordan, McGrath, Case & Partners/Euro RSCG, New York (SmithKline's Tums and Nicoderm CQ; Glaxo's prescription gastrointestinal drug Lotrinex); and Grey Advertising, New York (SmithKline's Aquafresh toothpaste and Glaxo's Wellbutrin antidepressant).

Copyright January 2000, Crain Communications Inc.

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