The Truth - The Whole Truth - And Nothing But3 Feb 2021 18:45
Rather than read the views of every nowhere nobody read this article by the FT. It sums Glaxo’s situation best.
UK drugmaker GlaxoSmithKline has warned that profits will suffer as it steps up investment in research and product launches in an effort to revitalise its pipeline.
Emma Walmsley, chief executive, also revealed fresh details of a two-year programme to split the company into separate pharma and vaccines, and consumer health, businesses. The split was first announced at the end of 2018, when GSK formed a £9.8bn consumer health joint venture with US rival Pfizer.
The comments came as GSK posted annual results on Wednesday that showed full-year sales rose 8 per cent year on year to £33.8bn, in line with expectations. Adjusted earnings per share in 2019 rose 4 per cent to 123.9p, below consensus expectations of 125p.
it warned that adjusted earnings could fall by as much as 4 per cent this year as it lifts spending.
Alongside details on the split, Ms Walmsley said GSK would look at further asset sales as it sought to generate cash to defray the costs of the break-up. Its prescription dermatology business, which has sales of more than £200m, was one area that was under “strategic review”.
Full-year sales in its consumer healthcare division rose 17 per cent to almost £9bn.
A bright spot for the company last year was the performance of its shingles vaccine, Shingrix, which helped drive the 21 per cent growth in vaccines revenues to £7.2bn.
Ms Walmsley described Shingrix as “the standout performer, with sales more than doubling to £1.8bn” and expected to cross the £2bn mark this year.
She also extolled two of its newer respiratory drugs: Nucala, a biologic, which had sales of £768m, and Trelegy, a COPD medicine, that had sales of more than £500m.
However Zejula, a cancer drug acquired through the $5bn purchase of Tesaro, a US biotech, disappointed, with sales for the year at £229m, against consensus expectations of £237m.
Jefferies analyst Peter Welford said the earnings outlook was “better than we feared but below consensus”. This year, he added, was “set to be a transition year” before Zejula, Trelegy, Nucala, and later Shingrix drive growth, “plus we see clinical news kick-starting belief in the steadily reinvigorated pipeline”.
Revealing fresh details of its break-up plan, due to be completed by July 2022, GSK said that the pharma and vaccines business would focus on science related to the immune system, use of genetics and new technologies.
Sign In
Follow the stocks
