P&G to exit the Pharma Industry

The Financial Times is reporting that P&G may be looking to exit the Pharma industry.
The article states that:

Mr Lafley [P&G's CEO] said that when P&G had been investing heavily in pharmaceuticals in the 1990s, the returns had been well above those from consumer products. “Today, pharma companies trade at multiples at or below consumer products,” he said.

He also drew attention to greater regulatory obstacles within the pharmaceuticals industry, and increased competition from generics that reduces the pay-off of companies’ research and development.

Mr Lafley said that in weighing potential divestitures, its primary focus in making decisions would be “creating maximum value for P&G shareholders”.

This is probably a wise move for P&G. The company never seemed fully committed to the Pharma industry. People in P&G's Pharma division have always told me that they felt that the Company's primary focus was on the Consumer Goods side of the business. P&G is a wonderful Consumer Prouducts company....but developing Pharmaceuticals is a whole lot different than making Shampoos.