British drugmaker GlaxoSmithKline (GSK) has beat earnings and revenue expectations after strong sales in its vaccines business boosted its second quarter financials.
In the first financial results presentation since the company came under fire from activist hedge fund Elliott Management, GSK posted second-quarter revenue of £8.1bn, above average analyst estimates of £7.6bn and a 6% year-on-year increase.
The boost came from strong sales of its vaccine business, which was up 39% to £1.6bn thanks to the strong growth (46%) of its meningitis vaccine.
Its established vaccines for hepatitis and diphtheria also rose by 28% as demand returned following previous disruption caused by the COVID-19 pandemic.
However, sales of its shingles jab Shingrix increased by only 1% on a constant currency basis, although the drugmaker is expecting strong growth from the vaccine in the second half of 2021.
Although GSK does not have an approved COVID-19 vaccine, its Sanofi-partnered candidate is currently being evaluated in phase 3 with a rolling review by the European Medicines Agency (EMA).
In Q2, GSK announced $16m in sales for its Vir Biotech-partnered COVID-19 antibody treatment sotrovimab – the company recently signed a deal with the European Commission to supply up to 220,000 doses of sotrovimab for the treatment of COVID-19.
“GSK delivered an excellent performance in Q2. 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,” said Emma Walmsley, chief executive officer of GSK.
“We continue to strengthen our pipeline and are advancing well towards separation. Our clear priority is to focus on execution, unlocking the value of consumer healthcare and delivering the step-change in growth and performance we now see for GSK,” she added.
Earlier this month, Elliott Management published a public letter to GSK highlighted what it perceived as ‘leadership failures’ regarding the company’s plans for the consumer health/biopharma separation as well as ‘years of underperformance’.
This also included calling for a process by which the leadership of the company would be reviewed, examining if Walmsley is the right leader for GSK’s new pharma business following the spin-off of its consumer healthcare business.
In response, GSK’s board said that it ‘strongly believes’ that Walmsley is the ‘right leader’ for the new biopharma business.
It added that it supports Walmsely and her management team’s actions and expects the team to “deliver a step-change in performance and long-term shareholder value creation through the separation and in the years beyond”.