Bottom Line: SKB finds the elixir

THERE was much to chew on in SmithKline Beecham's presentation yesterday. But perhaps the key focus for investors should be the remarkable way in which the company has achieved the objective it set two years ago of growing substitutes for its previously dominant Tagamet anti-ulcer product.

In 1991 four new SKB products - Paxil, Relafen, Kytril and Havrix - had sales of pounds 24m; by last year their turnover was pounds 463m.

These new product sales exactly offset the amount SKB will probably lose when Tagamet goes off patent in the US in May. About two-thirds of Tagamet's pounds 673m of sales last year were in the US.

But it is comforting - and no mean management feat - that it is no longer SKB's core product.

As for the future - the company says that last year it had 10 products with sales of more than pounds 100m each. This year it hopes to have 14 products in that category and by 1996 it says it is not impossible that it will have 20 such money-earners.

The uncertainty that has dogged drug stocks, forcing them to underperform dramatically, still has some way to run. Yet while some companies will suffer as the market shifts, others could capitalise on the weakness of their competitors. SKB's record to date has been excellent. A management for investors to back.