Wednesday, July 22, 2009

GSK adds to swine flu arsenal

Last updated: July 22 2009 19:49

GlaxoSmithKline on Wednesday moved to become the pharmaceuticals company with the broadest range of products to tackle the swine flu pandemic, as it unveiled plans for the sale of masks and diagnostics to add to its fast-growing vaccines and antiviral medicines business.

The UK company signalled a strong upsurge in demand from governments for its vaccines and its antiviral drug Relenza as the infection spreads, with plans to sharply expand manufacturing capacity.

It also attempted to head off criticism that it was cashing in on the pandemic, stressing that it had invested $2bn to date in development and manufacturing, and had committed to donate 10 per cent of its Relenza supplies and more than 50m doses of flu vaccines to poor countries. GSK said it had received orders for 195m swine flu vaccine doses so far, and was in discussions with 50 governments, with deliveries set to begin in September.

Andrew Witty, chief executive, played down suggestions that GSK would have difficulty meeting demand for those governments that have already placed orders.

He said: “The governments know very well that the pace of order fulfilment will be driven by the performance of the virus . . . but over any given time period we do believe that we’re going to be able to meet the kind of demand that we’ve been receiving so far.”

For the three months ending in June, pre-tax profit rose 12 per cent to £2bn ($3.3bn) on revenues that increased 14 per cent to £6.7bn.

GSK has taken orders from 60 governments for Relenza, and is tripling its production capacity to 190m courses annually, lifting its sales for the quarter to £60m against £3m last time.

Relenza, which is inhaled, has struggled to complete with its rival Roche’s Tamiflu as the leading antiviral treatment, but has found a niche notably for pregnant woman at risk, since it enters the lungs rather than being absorbed by the blood, limiting the risk to the foetus.

Separately, GSK announced plans to commercialise Actiprotect, a face mask designed to protect against flu particles, on top of a deal agreed this week with Enigma, a British diagnostics group, for a product to identify flu viruses within an hour.

The diversification fits Mr Witty’s strategy to expand the business into emerging markets and beyond prescription medicines into consumer health.

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