(Alliance News) - GlaxoSmithKline PLC on Wednesday reported a 14% slide in quarterly profit but reiterated its annual guidance and said that it is "urgently" advancing possible Covid-19 treatments.
The FTSE 100-listed pharmaceutical company added that it is making good progress on preparations to separate the company into two new companies - Biopharma and Consumer Health. The separation plan was first announced in February.
Chief Executive Officer Emma Walmsley said: "GSK has responded well to a challenging operating environment this year with disciplined cost control and strong commercial momentum in key growth products including Nucala, Trelegy, Benlysta, 2 drug-HIV regimens, Zejula, Shingrix and our priority Consumer Healthcare brands. This, combined with improving vaccination rates this quarter, means we are on track to deliver within our earnings guidance range for 2020.
"We are also urgently advancing possible Covid-19 Solutions with our partners, including clinical trials for antibody therapy VIR-7831 and three different adjuvanted vaccines. We expect to see data on all of these before the end of the year."
Glaxo and partner Sanofi SA, a French peer, had initiated a phase 1/2 study for the Covid vaccine in September with a total of 440 subjects enrolled. First results from the study are expected in early December, to support the initiation of a phase 3 study before the end of the year.
If the data are sufficient for license application, the companies intend to seek regulatory approvals for the vaccine from the first half of 2021.
Earlier on Wednesday, Glaxo and Sanofi agreed to make available 200 million doses of their Covid-19 vaccine to the Covax facility, a global risk-sharing mechanism for pooled procurement and equitable distribution of eventual Covid-19 vaccines.
Glaxo expects 2020 adjusted earnings per share decline to be "at the lower end" of the 1% to 4% at constant exchange rate guidance.
In 2019, Glaxo recorded adjusted earnings per share of 123.9 pence each. For the third quarter ended September, adjusted EPS fell 8% to 35.6p per share, though was up 1% at constant exchange rates.
Pretax profit for the third quarter fell 14% to GBP1.67 billion from GBP1.95 billion recorded a year ago. Operating profit was down 13% to GBP1.86 billion.
"The decrease in total operating profit reflected higher re-measurement charges on the contingent consideration liabilities and an adverse comparison to an increase in value of shares in Hindustan Unilever Ltd in Q3 2019, partly offset by higher asset disposals," Glaxo explained.
Revenue for the three months fell 8% year-on-year to GBP8.65 billion from GBP9.39 billion.
The company's pharmaceuticals business saw a 7% drop in revenue to GBP4.19 billion. HIV sales were down 4% at GBP1.22 billion, with growth in Juluca and Dovato offset by declines in Tivicay and Triumeq. Respiratory sales were up 21% at GBP978 million, on growth of Trelegy and Nucala. Sales of Established Pharmaceuticals declined 23% to GBP1.71 billion.
The vaccines division saw a 12% fall in revenue to GBP2.03 billion, largely driven by the negative impact of the Covid-19 pandemic on Shingrix, established vaccines and meningitis. The decline was partly offset by strong demand and lower expected returns for influenza vaccine in the US.
Consumer Healthcare sales declined 4% at GBP2.42 billion in the quarter reflecting a full quarter of sales of legacy Pfizer brands compared to two months in the third quarter of 2019. Growth in oral health and vbitamins, minerals and supplements brands was offset by weaker performance in respiratory health and pain relief.
Shares in Glaxo are down 1.0% at 1,348.11 pence each in London on Wednesday afternoon.
By Tapan Panchal; tapanpanchal@alliancenews.com
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Glaxosmithkline (GSK)
