GlaxoSmithKline has posted its third quarter results which reveal a 9% decrease in operating profit, before major restructuring charges, to £2.13 billion, while group turnover was down 2% at constant exchange rates, to £6.81 billion.
Pharmaceutical sales were down 3% to £5.55 billion, as generics cut sales of Valtrex (valaciclovir) for herpes by 75% to £95 million. The controversial Avandia (rosiglitazone) diabetes franchise slumped 65% to £70 million.
Sales of Avandia have been suspended in Europe and its use has been severely restricted in the USA. GSK took a £147 million charge in the quarter to write off supplies of the drug, and disclosed that it has received a subpoena from the US Department of Justice regarding its development and marketing of Avandia.
On the positive side, sales of Advair/Seretide (salmeterol and fluticasone) for asthma and chronic obstructive pulmonary disease were up 5% at £1.24 billion. Other strong performances came from Avodart (dutasteride), for the treatment of benign prostatic hyperplasia (+16% to £156 million), the heart disease drug Lovaza (omega-3-acid ethyl esters; +20% to £138 million) the breast cancer drug Tykerb/Tyverb (lapatinib; +26% to £58 million) and the bloodthinner Arixtra (fondaparinux; +17% to £72 million).
Vaccine sales were up 19% to £982 million, while consumer healthcare turnover was up 4% at £1.26 billion.
Chief executive Andrew Witty said that "clearly our operating environment is challenging and the measures being put in place by governments to reform healthcare and reduce deficits are impacting our performance along with others in our sector." He noted that turnover was hit 2% as a result of US healthcare reform and European government's ‘austerity measures.