SmithKline Selects New Drug R&D; Chief

SmithKline Beckman Corp.’s effort to spruce up its line of drugs, boost sagging profits and regain its luster on Wall Street has claimed another casualty.

The Philadelphia-based company said Stanley Crooke, president of research and development for its pharmaceutical division, Smith Kline & French Laboratories, resigned. SmithKline is now pinning its hopes on George Poste, 44, who will succeed Crooke, to lead the company into a new era of drug development.

Poste is vice president of worldwide research and preclinical development at Smith Kline & French Laboratories, a position he had held since January, 1987.

“Clearly, SmithKline is going to be looking at all its businesses, including research, to find ways to initiate savings and maybe cut programs that don’t make sense,” said Joseph Riccardo, a drug analyst with Bear, Stearns & Co. “A lot of people are going to be singled out and many more heads will roll,” he said.

Crooke’s resignation follows the departure on July 26 of James Cavanaugh, head of the company’s U.S. pharmaceutical unit, where sagging sales led to a 25.3% drop in second-quarter earnings.

Crooke, 43, joined the company in 1980 and was named president of R&D; at the drugs division in 1982. SmithKline said his successor, Poste, has served in a number of academic positions and has written more than 260 scientific papers.

Analysts say SmithKline’s problems stem from the lack of new drugs to compensate for declining sales of Tagamet, the billion-dollar ulcer drug that accounted for more than a fourth of the company’s $4.3 billion in sales last year. The company’s second-quarter profit fell to $98.7 million from $132.1 million a year ago.

But the company is working to remedy that. SmithKline has budgeted up to $500 million for the development of drugs this year, up from $424 million in 1987 and $377 million in 1986.

The company has said it will merge the three segments of SmithKline & French Laboratories, resulting in some layoffs. But analysts say a restructuring will not be enough to recoup flagging profits and that to boost profits, SmithKline must license new drugs.