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6 Months : From Oct 2019 to Apr 2020
--Glaxo revises guidance to flat on year adjusted EPS performance
--Performance, guidance upgrade supported by vaccines sales beat, newer drugs
--Advair sales fall following launch of generic competitor from Mylan
By Denise Roland and Carlo Martuscelli
GlaxoSmithKline PLC (GSK.LN) raised its full-year guidance as profits rose in the third quarter despite heavy investment in research and new competition for its top-selling inhaler Advair.
The British drug maker said adjusted earnings per share, a closely watched metric, rose 9% to 38.6 pence (49.02 cents), or 1% at constant currencies, in the three months to Sept 30. Net profit rose 9% to GBP1.6 billion.
For the full year, Glaxo now expects adjusted EPS to be flat at constant exchange rates, having previously said it expected a fall of 3% to 5%.
Glaxo attributed the strong performance, and the upgrade, to better-than-expected sales of some vaccines and newer drugs, as well as a tax boost.
Those factors overcame two big drags on profits.
The company has increased its spending on research as Chief Executive Emma Walmsley works to revitalize Glaxo's pipeline of branded prescription drugs. At the same time, Glaxo is for the first time facing low-cost competition for its best-selling inhaler Advair, which treats asthma and chronic obstructive pulmonary disease.
Advair lost patent protection in 2010 but went unchallenged for nearly a decade due to the difficulties of making a generic version of an inhalable drug. That changed earlier this year, when Mylan NV (MYL) started selling a cut-price version.
The new competition hit Advair sales hard in the third quarter. U.S. revenue for the treatment fell 62% to GBP117 million, dragging global revenue for the product down 32% to GBP418 million.
Despite that, Glaxo's total revenue climbed 16% to GBP9.4 billion in the third quarter, thanks to strong sales of newer HIV drugs and the vaccine Shingrix.
The addition of products from Pfizer Inc.'s (PFE) consumer health-care business, which started contributing to sales in August, also boosted revenue. Glaxo and Pfizer announced a deal to combine their consumer health units in December last year and the deal closed in August.
Write to Denise Roland at email@example.com and Carlo Martuscelli at firstname.lastname@example.org
(END) Dow Jones Newswires
October 30, 2019 09:41 ET (13:41 GMT)
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