Note: All changes are versus the prior-year period unless otherwise stated
CEO Emma Walmsley called 2020 a year of "significant progress" for GlaxoSmithKline, adding "we invested in our pipeline and new launches, readied the company for separation, and had to rapidly mobilise and respond to the pandemic." She said "we delivered our guidance for the year, offsetting the significant impact of COVID-19 on adult vaccinations, with strong performances of new products."
GlaxoSmithKline indicated that it is on track regarding the pending separation of the company into standalone biopharmaceutical and consumer healthcare businesses in 2022. As it works to finalise the split, the drugmaker said it achieved its 2020 target for £300 million ($409 million) in annual cost savings.
The financial results presentation Wednesday coincided with an announcement that GlaxoSmithKline is partnering with CureVac to develop mRNA-based vaccines targeting COVID-19 variants, following some recent setbacks in its pandemic-related efforts with Sanofi and Clover Pharmaceuticals.
GlaxoSmithKline is forecasting a decline this year in the mid- to high-single digits for adjusted earnings per share at constant currencies, largely due to impacts from the COVID-19 pandemic. Pharmaceutical revenue is expected to grow flat to low-single digits, while consumer healthcare sales are anticipated to grow by low- to mid-single digits, in both cases assuming healthcare systems and consumer trends "approach normality" in the second half.
The company also anticipates "further disruption" in the vaccines business in the first half, given governments' prioritisation of COVID-19 vaccination programmes and the pandemic resurgence late last year. "This is expected to impact adult and adolescent immunisations, including Shingrix, notably in the US," GlaxoSmithKline said. Still, the drugmaker said it remains "very confident in demand for these products, and expect strong recovery and contribution to growth from Shingrix" in the second half, while vaccines revenue is projected to grow flat to low-single digits in 2021.
For further analysis, read ViewPoints: GSK cuts guidance, puts on a brave face.
Hargreaves Lansdown analyst Nicholas Hyett called the quarterly results "a bit of a mess" with disappointing underlying numbers and sales "going backwards." Hyett said "management put that down to a few identified brands that are already earmarked for disposal, but the remaining 'core' products aren't exactly shooting the lights out."
Commenting on the pending business separation, Hyett suggested "the move can't come soon enough." The analyst noted that GlaxoSmithKline "in its current iteration seems to be struggling to set out a clear vision of what it offers investors. Hopefully its successor companies are a little more streamlined."
GlaxoSmithKline disclosed that development of Benlysta in combination with Roche's Rituxan (rituximab) for patients with Sjogren's syndrome was stopped for not meeting efficacy criteria. The company also confirmed that a Phase II study of the depleting anti-LAG antibody GSK2831781 in patients with active ulcerative colitis was terminated "as pre-determined futility criteria were met." Partner Immutep first announced the news last month.
Meanwhile, GlaxoSmithKline said that the OSM antagonist GSK2330811 in systemic sclerosis was removed from Phase I expansion/ Phase II after "meeting the proof of mechanism study’s stop criteria." The drugmaker added that Phase I development of the OX40 agonist GSK3174998 was ended "due to lack of sufficient clinical activity."
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