Note: All changes are versus the prior-year period unless otherwise stated
"Our first-quarter results are in line with our expectations and reflect the anticipated impacts of COVID-19," remarked CEO Emma Walmsley, adding "we continue to expect a significant improvement in performance over the remainder of the year."
The drugmaker cited "strong growth" in new and speciality products in the respiratory, immuno-inflammation and oncology segments as helping to offset the effects of stocking and disruption caused by the COVID-19 pandemic. This included government prioritisation of COVID-19 vaccinations over those to prevent other illnesses, denting sales at GlaxoSmithKline's vaccines unit for products such as Shingrix, notably in the US.
Meanwhile, GlaxoSmithKline reiterated that it remains on track regarding its pending separation into standalone biopharmaceutical and consumer healthcare businesses in 2022.
GlaxoSmithKline reaffirmed that it expects a decline this year in the mid- to high-single digits for adjusted earnings per share at constant currencies.
The drugmaker appeared to be pinning hopes for a near-term recovery on the global rollout of COVID-19 vaccines developed by rivals. It highlighted the rapid pace of COVID-19 vaccinations, particularly in the US and UK, saying "we remain confident in the underlying demand for our vaccine products, and we expect strong recovery and contribution to growth, notably from Shingrix, in the second half of the year." It said it continues to expect vaccine revenue for 2021 to grow flat to low-single digits at constant currencies.
Sebastian Skeet of Third Bridge said GlaxoSmithKline had "endured a pretty lacklustre 2020 following a number of pipeline setbacks and COVID-19 disruption," but he warned that their 2021 performance "looks all too familiar." According to Skeet, "not only have existing challenges such as a muted Shingrix recovery, late-stage pipeline setbacks, and increased competition around key on-market assets persisted…but we have seen additional pressures in the form of currency and shareholder activism," with reports that hedge fund Elliot Management recently built up a multibillion-pound stake in the UK drugmaker.
Meanwhile, Hargreaves Lansdown's Steve Clayton remarked that with "major structural change on the cards with or without Elliot's alternative vision, it looks set to be a year of forced evolution at GlaxoSmithKline." Clayton added that while it remains unclear what the hedge fund will push for, "it's a safe bet that they see more value taking a course different from that which GlaxoSmithKline is currently following."
GlaxoSmithKline said the experimental anti-CD3 bispecific GSK3537142, which targets NY-ESO, was removed from the Phase I pipeline due to "portfolio prioritisation." Partner Immunocore disclosed recently that it would not proceed with the expansion phase of an early dose-escalating study for synovial sarcoma, an area already addressed by other assets in its portfolio, with GlaxoSmithKline choosing not to license the programme. Meanwhile, the hPGD2 synthase inhibitor GSK3439171, which was being developed for Duchenne muscular dystrophy, was also cut from GlaxoSmithKline's early-stage pipeline as part of "portfolio prioritisation."
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