GSK sales down on Avandia and pandemic products
pharmafile | July 27, 2011 | News story | Research and Development, Sales and Marketing | GSK
GlaxoSmithKline has posted a slide in revenue for the second quarter, but is buoyed by strong underlying growth.
Sales were down 2% to £6.7 billion at a constant exchange rate, due primarily to GSK’s loss of its troubled diabetes drug Avandia last year, a decrease in sales of pandemic products and the patent loss for its herpes treatment Valtrex.
But when these products are excluded, the UK pharma firm saw underlying growth of 5%, and believes it will return to overall growth in the near future.
Overall pharma sales fell 1% at constant exchange rates to $4.7bn, dragged down by a 15% drop in vaccines sales, which fell to £787 million. In consumer healthcare product sales were stronger, rising 4% to £1.3bn.
GSK’s biggest area remains respiratory drugs, where its blockbuster asthma treatment Seretide saw steady growth of 2% to £1.3bn.
Its two new cancer drugs – Tyverb for breast cancer and Votrient for renal cell carcinoma – also saw steady growth, bringing in £59m and £22m respectively.
GSK will also be boosted by three key product launches this year, including its lupus treatment Benlysta, restless leg syndrome treatment Horizant and epilepsy drug Trobalt, which today received the thumbs up from UK cost-effectiveness body NICE for use on the NHS.
Geographically the biggest underlying growth came from emerging markets, where sales were up 20% on this time last year. Japan also brought in the numbers, with sales up 12% in the world’s second largest pharma market.
Healthcare reforms in the US held revenue growth down to just 3%, but the company’s worst performance was seen in Europe, where sales decreased by 1%, due to increasing austerity measures across the continent.
The worst seems to be over for GSK. After a restructuring programme designed to save £500m over two years, the company is now not expected to face any additional restructuring charges and also looks to be safe from further generic erosion for some time.
Analysts at Matrix said: “We believe GSK has seen the bulk of the near-term generic erosion behind it.
“We do not see significant generic risks going forward, despite the fact that Advair could see generic competition in Europe at the end of this year.”
Matrix also pointed out that firm has a ‘very impressive pipeline’, with data from 14 late-stage products reading out before end of 2012, which is also supported by over 30 phase III clinical trials.
Ben Adams
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