Bumper sales of GlaxoSmithKline’s Covid-19 antibody treatment and a bounce back in demand for its shingles vaccine helped the UK drugmaker beat expectations in the first quarter.
GSK reported £9.8bn in revenue, up 32 per cent year on year, and above the consensus forecast of £9.2bn.
Sales of Xevudy, the Covid-19 antibody treatment that received emergency approval last year, hit £1.3bn in the quarter. Sales of Shingrix, the vaccine to prevent shingles, doubled to £698mn after being hit hard in the first quarter of last year, when Covid-19 vaccines were given priority.
Adjusted earnings per share were 32.8p, up 43 per cent on constant exchange rates, and higher than the average analyst estimate of 30p. GSK declared a dividend of 14p for the first quarter.
Emma Walmsley, the drugmaker’s chief executive, said it had delivered “strong first-quarter results in this landmark year for GSK”, as it prepares to spin off its consumer healthcare division into a company to be named Haleon.
“Our results reflect further good momentum across speciality medicines and vaccines, including the return to strong sales growth for Shingrix and continuing pipeline progress,” she said.
Walmsley has been under pressure from activist shareholders, including US hedge fund Elliott Management, to show that she can refill the company’s lacklustre drug pipeline. The spin-off will expose the pharmaceuticals business to more scrutiny — but also provide cash that could be used to acquire companies or do more partnerships to access their assets.
GSK confirmed its guidance for the full year, with the slimmed down company focused on pharmaceuticals and vaccines expecting sales of between 5 to 7 per cent, and adjusted profit to grow between 12 and 14 per cent, at constant exchange rates.
The 2022 guidance excludes any contribution from Xevudy, developed with Vir Biotechnology. Xevudy had benefited as rival antibody treatments struggled to treat patients infected with the Omicron variant. But with the rise of the BA.2 version of Omicron, Xevudy lost its US emergency use authorisation, after data showed it was unlikely to be effective against the subvariant.
Haleon — which sells products including vitamins and over-the-counter medicines — unveiled its guidance earlier in the quarter, forecasting annual organic revenue growth of between 4 and 6 per cent, and “sustainable moderate expansion” of adjusted operating margin over the medium term.