Send me real-time posts from this site at my email

Glaxo's (GSK) New Drugs Drive Sales Amid Rising Competition

GlaxoSmithKline’s GSK new and specialty products like Nucala, Trelegy Ellipta, Shingrix and Juluca are doing well and have become key drivers of top-line growth, making up for a decline in Established Pharmaceuticals due to generic erosion. Sales of Glaxo’s new and specialty pharma products increased 18% in the first nine months of 2021.

Glaxo has made significant progress in its pipeline. Promising candidates in late-stage development include otilimab (rheumatoid arthritis), gepotidacin (uncomplicated urinary tract infection and urogenital gonorrhoea), GSK3511294, (severe eosinophilic asthma), RSV vaccines and Duvroq/daprodustat (anemia associated with chronic renal disease – phase III).

Key new drug approvals of 2020/2021 were Rukobia/fostemsavir for heavily pre-treated HIV, Blenrep/belantamab mafatotin for fourth-line multiple myeloma; Cabenuva, a long-acting injectable HIV treatment; Jemperli (dostarlimab) for second-line endometrial cancer and mismatch repair-deficient (dMMR) recurrent or advanced solid tumours and Apretude, a long-acting injectable form of cabotegravir drug for the prevention of HIV infection, also called pre-exposure prophylaxis or PrEP

Several new drug/line extension approvals are expected in 2022, which should boost sales. Glaxo plans to launch more than 20 new products/line extensions by 2026 with more than 10 having blockbuster potential.

In 2020 and 2021, Glaxo established multiple partnerships to develop COVID-19 solutions, including with CureVac to develop next-generation mRNA COVID vaccines. It entered into a partnership with Sanofi SNY to make adjuvanted COVID-19 vaccine and with Vir Biotechnology VIR for therapeutic antibody treatments like Xevudy (sotrovimab).

Sanofi and Vir Biotechnology’s Xevudy (sotrovimab) was authorized in the United States in May 2021 and Europe in December 2021. Xevudy contributed 3 percentage points of growth to Glaxo’s total pharmaceutical sales in the third quarter. Last month, Glaxo and Vir Biotechnology announced pre-clinical data, which demonstrated that sotrovimab maintains activity against the full combination of mutations of the spike protein in the Omicron variant.

Sanofi and Glaxo are developing an adjuvanted recombinant protein-based COVID-19 vaccine candidate, which is in pivotal late-stage development. The vaccine is being developed by combining Sanofi’s recombinant protein-based technology with Glaxo’s pandemic adjuvant technology.

Glaxo plans to split itself into two standalone companies. The new Glaxo will be a biopharma company focusing on developing new treatments. Glaxo intends to separate its Consumer Healthcare (CHC) segment into a standalone company in 2022.

Glaxo’s CHC segment is a joint venture between Glaxo and Pfizer. Glaxo owns a controlling stake of 68%.

Last week, Glaxo rejected a $68 billion buyout offer for its CHC business from consumer giant, Unilever UL. Glaxo received a non-binding and conditional acquisition offer of 50 billion pounds ($68 billion) for its CHC unit from Unilever on Dec 20, 2021. Glaxo said it had rejected this offer as well as two previous unsolicited proposals from Unilever as it believes they fundamentally undervalue the CHC unit. Unilever, in a press statement, confirmed that it approached Glaxo about a potential purchase of the CHC unit. Later, Unilever, in a separate press release, mentioned that it will not raise its offer above 50 billion pounds.

An acquisition offer from Unilever or another company may result in a sale instead of a spin-off.

Glaxo has its share of problems. Generic competition for key drug, Advair is hampering sales of Glaxo’s respiratory products, which we believe may not be compensated by new respiratory drugs. Competitive pressure on HIV drugs has risen. Sales of its key vaccine Shingrix declined 30% in the first quarter of 2021 due to lower demand, following the prioritization of COVID-19 vaccination programs, which resulted in lower Shingrix vaccination. Though vaccine sales recovered somewhat in the second and third quarters, the surge in the Delta variant delayed the expected second-half recovery in Shingrix prescriptions, particularly in the U.S. retail channel. Shingrix sales in the fourth quarter are expected to have been hurt due to a difficult comparison to the fourth quarter of 2020 and the prioritization of COVID booster vaccinations in the near term. Glaxo is scheduled to report fourth-quarter and full-year 2021 results on Feb 9.

Zacks Names "Single Best Pick to Double"

From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.

As one investor put it, “curing and preventing hundreds of diseases…what should that market be worth?” This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.

Free: See Our Top Stock and 4 Runners Up >>

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Sanofi (SNY): Free Stock Analysis Report
GlaxoSmithKline plc (GSK): Free Stock Analysis Report
Unilever PLC (UL): Free Stock Analysis Report
Vir Biotechnology, Inc. (VIR): Free Stock Analysis Report
To read this article on click here.

Welcome! Is it your First time here?

What are you looking for? Select your points of interest to improve your first-time experience:

Apply & Continue