The pace of change accelerated at GlaxoSmithKline Plc in 2018 as the company redirected its therapeutic focus towards oncology and took the first steps towards spinning off its consumer products business into a separate company. Emma Walmsley, chief executive since April 2017, said in a teleconference on 6 February that the company’s key priority going forward is to “rebuild the pharmaceutical pipeline.”
Group sales in 2018 were £30.8 billion, up by 2% from a year earlier. Vaccine sales, helped by the strong performance of the shingles treatment Shingrix, were up by 14% at £5.9 billion. But consumer healthcare sales were down by 1% at £7.7 billion and pharmaceutical sales, which represent a little more than half of group turnover, were flat at £17.3 billion.
The operating profit was £5.5 billion, up by 34% from a year earlier.
In late January, the US Food and Drug Administration approved the first generic version of Advair, an asthma drug that has been a cornerstone of GSK’s respiratory portfolio for years. In 2018, Advair generated sales of £2.4 billion. Although the market entry of a generic Advair has been anticipated for months, the impact on group earnings in 2019 is expected to be substantial. GSK is predicting earnings per share, excluding impairments and amortisations, to decline by 5% to 9%. This follows an increase of 7% in 2018.
The company’s refocus on oncology was dramatically illustrated in early December 2018 when it reached an agreement to acquire Tesaro Inc for $5.1 billion. Tesaro has a PARP inhibitor, Zejula, on the market for the treatment of patients with ovarian cancer. PARP is an enzyme that helps damaged cancer cells stay alive. By inhibiting the enzyme, drugs like Zejula destroy cancer cells by preventing them from repairing damaged DNA.
“We think the PARP class [of drugs] is undervalued,” said Hal Barron, GSK’s chief scientific officer.
The company is also accelerating development of an antibody-drug conjugate for multiple myeloma. The drug targets the B cell maturation antigen (BCMA) using linker technology in-licensed from Seattle Genetics Inc. BCMA is a member of the tumour necrosis factor receptor family. More recently, on 5 February, GSK entered a collaboration with Merck KGaA to co-develop a bifunctional fusion protein product for lung cancer. The product will be tested against pembrolizumab, the leading checkpoint inhibitor, which already has been approved for five lung cancer indications in the US.
Ms Walmsley said that since July 2018 the company has doubled the number of oncology assets in clinical development to 16. This year, it expects to receive pivotal data on three new cancer medicines all of which may be launched in the next two years.
At the same time it will be combining its consumer healthcare business with that of Pfizer Inc with the goal of eventually spinning out the merged group into a separately listed company.
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