GlaxoSmithKline has posted another drop in revenue as it fights against tough economic climates.
Group sales were down 5% at constant exchange rates to £6.5 billion in the third quarter, with the firm blaming continues economic austerity in Europe as a major contributing factor to its drop.
Sales declined by 9% in Europe for the quarter and by 6% in the USA, as both recession-hit markets look to rein in healthcare costs. But this was partially offset by strong growth in the EMPAS region, which was up 11 per cent.
Pharma and vaccines sales were down 6% to £5.3 billion, again because of the tough times in mature markets.
Speaking on Europe, GSK’s chief executive Sir Andrew Witty, said: “It is clear that the European market is facing a prolonged period of significant economic pressure. In this context we are reviewing our current business and assessing how best to respond to this environment and meet the increasingly diverse needs of European governments.
“Despite these challenges, we expect to see sales grow in the fourth quarter, in particular with further momentum in EMAP including anticipated completion of multiple pre-ordered vaccine tenders. On this basis, and absent a further deterioration in Europe, we now expect sales for the year to be broadly in line with 2011 on a constant currency basis.”
Sales of its biggest selling drug Seretide, licensed for respiratory conditions, grew 2% to £1.21 billion. Its second biggest selling treatment, the urogenital drug Avodart, saw healthy growth of 9%, up to £199 million for the quarter.
Its new lupus drug Benylsta, made in conjunction with recently acquired Human Genome Sciences, saw unremarkable sales of £20 million. The drug was only approved by the FDA in March, but its sluggish sales continue to disappoint analysts.
But seeing as HGS is now owned by GSK, the firm will hope its manufacturing and marketing might will be able to lift sales of the drug, which is still touted as a potential blockbuster given that it is the first treatment for the condition in 50 years.
The company was also hit by a $3 billion (£1.9 billion) fraud charge in the second quarter, but had already set aside this money last year in anticipation of this fine.
Sir Andrew said: “In conclusion, our focus is to continue to deliver on our strategy to maximise growth opportunities and actively prepare for the roll-out of multiple new products.