Sales healthy thanks to flu pandemic
SOARING global demand for swine flu vaccinations is expected to give drug giant GlaxoSmith- Kline a £1bn sales boost in the final three months of the year.
Glaxo, which has around 1,000 staff at its plant in Barnard Castle, said it had shipped 25 million doses of its swine flu vaccine so far and was “in good shape“ to meet orders for 440 million worldwide.
The firm added it had already taken further Government orders since it last updated the stock market and has also pledged to donate 50 million doses to the World Health Organisation to help in the fight against the flu pandemic.
Glaxo reported a 3% rise in third-quarter sales £6.76bn, but the results do not yet include figures for its Pandemrix vaccination for the H1N1 virus. The group received approval for the vaccine in Europe last month and has been “ramping up” production over the past three weeks to meet surging demand.
It has yet to receive approval in the US, but said it was a minor player in the American vaccination programme, with orders expected of around 7.5 million doses.
Fears are growing of a winter surge in the pandemic after the estimated number of new cases of swine flu in the UK almost doubled last week to 53,000, bringing the total number of cases to 435,000.
Glaxo said it was concentrating on speeding up manufacturing capabilities to meet its contractual commitments. It makes Pandemrix in Dresden and Quebec, but the demand is so great - more than 50% more than for normal seasonal flu - that the firm is also outsourcing production to third-party manufacturers.
Glaxo also produces the Relenza flu treatment and is hoping to produce around 190 million doses by the end of the year.
Demand for the swine flu treatment helped Glaxo return to sales growth for the first time in two years and it said it expected further growth in the fourth quarter thanks to “significant“ flu drug sales.
Glaxo reported underlying pre-tax profits of £2.07bn in the three months to September 30 - up from £1.88bn a year ago - but it also faced restructuring costs of £152m.
The firm said it was “on track” to shave £1.7bn off its annual cost base by the end of 2011 - plans that will result in job losses, although Glaxo has not revealed how many of its 100,000-strong global workforce will be let go.
Earlier this year Glaxo announced it would cut 200 staff at Barnard Castle over the next 12 months, but more recently added some of those would be put on hold due to demand for the swine flu vaccine.
