Vaccine sales help GSK beat forecasts

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GlaxoSmithKline’s chief executive said its turnround was not a “mañana” story as the UK drugmaker beat earnings and revenue expectations on the back of strong sales in its vaccine business.

Emma Walmsley said her plan for a slimmed-down “new GSK”, outlined last month, had received “widespread support” from shareholders.

“What shareholders want us to focus on, and we remain focused on, is execution and delivery,” she said.

Walmsley has been under pressure since US hedge fund Elliott Management took a multibillion-pound stake to push for change, including calling for a process to examine whether she would be the best leader for GSK’s pharmaceutical business after the spin-off of the consumer unit next year.

Walmsley’s top team has been courting investors in 400 meetings since April, and in June unveiled ambitious targets for growth above 5 per cent in revenue and 10 per cent in adjusted operating profit.

The pharmaceutical company reported second-quarter revenue of £8.1bn, above the average analyst estimate of £7.6bn and up 6 per cent year on year or 15 per cent on a constant currency basis.

GSK reported adjusted earnings per share of 28.8p, higher than the consensus forecast. Total operating profit was £1.7bn.

“We expect this positive momentum to continue through the second half of the year, driving us towards the better end of our earnings guidance range for 2021 and meaningful performance improvement in 2022,” Walmsley said.

Sales of GSK’s meningitis jab soared 46 per cent while those of established vaccines such as for hepatitis and diphtheria rose 28 per cent as demand rebounded from the disruption of the coronavirus pandemic.

But sales of Shingrix, GSK’s blockbuster vaccine that protects older adults against shingles, rose only 1 per cent on a constant currency basis.

Walmsley said healthcare systems were recovering from the pandemic at different rates around the world, with the UK benefiting from some of the best adult vaccination rates but many regions, including south-east Asia, “seriously burdened”.

GSK’s shares, which have fallen 13 per cent in the past year, fell 0.4 per cent to 1,394p in London on Wednesday.

GSK does not yet have an approved Covid-19 shot as it chose to provide its adjuvant, which boosts the efficacy of vaccines, to partners including French pharmaceutical company Sanofi, none of which have finished their phase 3 trials. The company reported sales of £258m of its adjuvant in the first half.

“We were frustrated to see the delay of one of them but we’re very excited to be able to see the results of the phase 3s in coming months,” Walmsley said.

She added that the company still had opportunities in the booster market and was in talks with governments about their preparedness efforts for future pandemics.

GSK booked £16m in revenue from its antibody treatment with Vir Biotechnology in the first half. GSK and Vir signed a deal on Wednesday with the European Commission to supply up to 220,000 doses of their antibody treatment for Covid. The treatment is designed for high-risk patients to stop them progressing to severe disease.