GSK shares fall after sales of top two vaccines disappoint
Sales for top two vaccines disappoint
Cuts vaccine outlook, cites US agency decision on RSV
Shares fall as much as 2.2%
Raises annual earnings, sales outlook for 2nd time this year
Factors hitting vaccine sales are short-term: CEO
Adds vaccines concerns from analyst call in paragraph 12
By Yadarisa Shabong and Maggie Fick
July 31 (Reuters) -British drugmaker GSK GSK.L cut its forecast for 2024 vaccine sales on Wednesday after quarterly revenue from its blockbuster shingles and respiratory syncytial virus (RSV) jabs missed expectations, sending its shares lower.
CEO Emma Walmsley's bet on infectious disease drugs and vaccines, including new blockbuster respiratory syncytial virus (RSV) vaccine Arexvy, has been paying off as GSK faces a combination of patent expiries and declining revenue from current best-sellers by the end of this decade.
But second-quarter sales of Arexvy, which launched in the U.S. last year and took two-thirds of the market in a blow to Pfizer's PFE.N rival jab, came in at 62 million pounds ($80 million), below analysts' average forecast of 70 million pounds.
Sales of its shingles vaccine Shingrix - GSK's big blockbuster drug before Arexvy - were also well below market expectations at 832 million pounds. Analysts at Jefferies cited weak U.S. demand, destocking and lower benefits than expected from supplies to Zhifei China after a $3 billion deal last year.
GSK shares were down 2.2% at 1213 GMT, set for their biggest one-day fall in a month and the largest weighted drag on the FTSE 100.
That was despite the company beating second-quarter results forecasts and raising its full-year sales and profit estimates, with sales of cancer, HIV and other speciality medicines expected to offset the lower vaccine growth.
"GSK reported good results beating expectations on revenues and EPS, and raised full year outlook, but the shares are weaker as investors digest the uncertainty around lower demand in the US for two key vaccines", said Lucy Coutts, investment director at wealth management firm JM Finn, which holds GSK shares.
A U.S. public health agency's decision last month to narrow the recommended age for use of RSV vaccines and delay the recommendation for adults under 60 unnerved GSK investors, who had hoped for a larger market for Arexvy this winter. Shares fell 6% the day after that decision was announced.
Walmsley, speaking on a media call on Wednesday, called the postponement of the decision for younger adults "surprising". GSK would share additional data with U.S. agencies by the end of this year, she said.
Citing the U.S. agency's decision, GSK cut its forecast for 2024 vaccine sales. It now expects that business to grow by a low to mid-single digit percentage, from an earlier expectation of high single-digit to low double-digit percentage growth.
Walmsley said the factors impacting vaccine sales were short-term, She also said she expected the company to "win the season", responding to a question about a statement by a Pfizer executive a day earlier that the company had "significantly strengthened" its contracting position with retail pharmacies ahead of the winter RSV season.
She and other executives later faced a barrage of questions on an analyst call about the vaccine sales guidance downgrade and were pressed on, among other concerns, whether GSK could retain market leadership with its RSV vaccine this season.
GSK reported second-quarter core earnings per share (EPS) of 43.4 pence on sales of 7.88 billion pounds, topping analysts' average forecasts of 38.9 pence and 7.51 billion pounds respectively, according to company-compiled consensus estimates.
It now expects 2024 core EPS to increase between 10% and 12%, from an earlier forecast of 8% to 10% growth. This is the second time this year it has raised its 2024 profit forecast.
Sales for the year are forecast to rise between 7% and 9%, from a previous range of 5% to 7% growth.
($1 = 0.7790 pounds)
Reporting by Yadarisa Shabong in Bengaluru; Editing by Mrigank Dhaniwala and Mark Potter
Mga Kaugnay na Asset
Pinakabagong Balita
Disclaimer: Ang mga kabilang sa XM Group ay nagbibigay lang ng serbisyo sa pagpapatupad at pag-access sa aming Online Trading Facility, kung saan pinapahintulutan nito ang pagtingin at/o paggamit sa nilalaman na makikita sa website o sa pamamagitan nito, at walang layuning palitan o palawigin ito, at hindi din ito papalitan o papalawigin. Ang naturang pag-access at paggamit ay palaging alinsunod sa: (i) Mga Tuntunin at Kundisyon; (ii) Mga Babala sa Risk; at (iii) Kabuuang Disclaimer. Kaya naman ang naturang nilalaman ay ituturing na pangkalahatang impormasyon lamang. Mangyaring isaalang-alang na ang mga nilalaman ng aming Online Trading Facility ay hindi paglikom, o alok, para magsagawa ng anumang transaksyon sa mga pinansyal na market. Ang pag-trade sa alinmang pinansyal na market ay nagtataglay ng mataas na lebel ng risk sa iyong kapital.
Lahat ng materyales na nakalathala sa aming Online Trading Facility ay nakalaan para sa layuning edukasyonal/pang-impormasyon lamang at hindi naglalaman – at hindi dapat ituring bilang naglalaman – ng payo at rekomendasyon na pangpinansyal, tungkol sa buwis sa pag-i-invest, o pang-trade, o tala ng aming presyo sa pag-trade, o alok para sa, o paglikom ng, transaksyon sa alinmang pinansyal na instrument o hindi ginustong pinansyal na promosyon.
Sa anumang nilalaman na galing sa ikatlong partido, pati na ang mga nilalaman na inihanda ng XM, ang mga naturang opinyon, balita, pananaliksik, pag-analisa, presyo, ibang impormasyon o link sa ibang mga site na makikita sa website na ito ay ibibigay tulad ng nandoon, bilang pangkalahatang komentaryo sa market at hindi ito nagtataglay ng payo sa pag-i-invest. Kung ang alinmang nilalaman nito ay itinuring bilang pananaliksik sa pag-i-invest, kailangan mong isaalang-alang at tanggapin na hindi ito inilaan at inihanda alinsunod sa mga legal na pangangailangan na idinisenyo para maisulong ang pagsasarili ng pananaliksik sa pag-i-invest, at dahil dito ituturing ito na komunikasyon sa marketing sa ilalim ng mga kaugnay na batas at regulasyon. Mangyaring siguruhin na nabasa at naintindihan mo ang aming Notipikasyon sa Hindi Independyenteng Pananaliksik sa Pag-i-invest at Babala sa Risk na may kinalaman sa impormasyong nakalagay sa itaas, na maa-access dito.
