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GSK turnover down in first quarter

GlaxoSmithKline has posted a 9 per cent decrease in operating profit for the first quarter and a 3 per cent reduction in turnover compared to the same period in 2007
GlaxoSmithKline (GSK) has posted a 9 per cent decrease in operating profit for the first quarter and a 3 per cent reduction in turnover compared to the same period in 2007.

Overall pharmaceutical turnover went down by 4 per cent to £4.8bn and earnings per share falling by 9 per cent from 27.0p to 24.4p.

GSK says that competition from generic drugs in the US and a decline in Avandia sales had an adverse effect on growth of other key products. Avandia, a treatment for Type II diabetes, saw a 56 per cent decrease in sales to £191m with US sales for the first quarter down by 66 per cent.

JP Garnier, chief executive officer of GSK, said: "Our performance this quarter was in line with our expectations. We continue to see sustained growth from key areas of our business such as Seretide/Advair, vaccines and consumer."

Seretide/Advair, developed for treatment of asthma and chronic obstructive pulmonary disease (COPD), performed well in the US market with sales rising of 10 per cent to £499m and overall sales growth of 10 per cent to £954m.

Sales of vaccines were up by 10 per cent in the first quarter to £436m, a figure boosted by strong performance in the US market where sales grew by 34 per cent to £109m. The European Medicines Agency (EMEA) granted a positive opinion in February 2008 for Prepandrix, GSK's pre-pandemic avian flu vaccine, which governments have already expressed an interest in stockpiling. In April, the US Food and Drug Administration (FDA) approved Rotarix, a two-dose gastroenteritis vaccination, sales of which grew by 79 per cent to £27m in non-US markets.

Garnier said: "We are also making good progress in strengthening our product portfolio, with approvals and regulatory progress on four key products already this year. These products are at the forefront of a substantive pipeline of projects in clinical development."

Pipeline Prospects

At present, GSK has 157 projects in clinical development, 75 per cent of which involve the use of new molecules or vaccines.

GSK will present information about its cancer treatment R&D programmes to the American Society of Clinical Oncology at a meeting in Chicago on May 30. Data about lapatinib medicines such as Tykerb/Tyverb, indicated for breast cancer treatment in the US and approved in over 20 countries, will be discussed in addition to details of various investigational drug trials.

GSK said that through its "revolutionary 'bench to bedside' approach, we are transforming the way treatments are discovered and developed, resulting in one of the most robust pipelines in the oncology sector. Our worldwide research in oncology includes collaborations with more than 160 cancer centres".

23rd April 2008

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