GSK's full year trading update

GlaxoSmithKlineTotal Group turnover for the year declined 1% to £28.4 billion, with pharmaceutical turnover down 2% to £23.4 billion and Consumer Healthcare sales up 5% to £5.0 billion. Excluding pandemic products, Valtrex and Avandia, Group sales were up 4.5% for the year.

Regional pharmaceutical turnover
US pharmaceuticals sales declined 11% to £7.6 billion, primarily due to generic competition to Valtrex, a significant reduction in sales of pandemic related products and lower sales of Avandia. Excluding these products, sales grew 3%, despite the discontinuation of GSK's promotion of Boniva, the sale of Wellbutrin XL in May 2009, and the impact of US healthcare reform across the product range. New products launched since 2007 grew 29% and contributed 8% of 2010 sales.

Europe pharmaceuticals sales declined 6% to £6.5 billion, primarily due to the impact of a significant reduction in sales of pandemic related products, generic competition to Valtrex and lower sales of Avandia. Excluding these products, sales were flat, reflecting the impact of government austerity measures.

Emerging Markets pharmaceutical sales grew 22% to £3.6 billion, with strong growth across most product categories and also helped by pandemic related product sales of £227 million (2009: £89 million). Asia Pacific/Japan pharmaceutical sales grew 9% to £3.1 billion. Excluding pandemic related products, Valtrex and Avandia, sales grew 20% in Emerging Markets and 7% in Asia Pacific/Japan.

Pharmaceutical products
Seretide/Advair sales grew 2% to £5.1 billion, with strong growth in Japan (+17% to £246 million) and Emerging Markets (+16% to £328 million). Sales in the USA were level at £2.6 billion and grew 2% in Europe to £1.6 billion.

Several other respiratory products delivered growth including Avamys/Veramyst (+33% to £193 million), Ventolin (+8% to £522 million) and Flovent (+2% to £804 million).

Total vaccine sales grew 15% to £4.3 billion, including £1.2 billion of pandemic vaccine sales (2009: £883 million). Several new vaccines contributed to this growth including Synflorix (more than doubling to £221 million), Boostrix (+29% to £181 million) and Cervarix (+26% to £242 million). Sales of Hepatitis vaccines grew 7% to £720 million, Infanrix/Pediarix grew 8% to £700 million and seasonal flu sales grew 14% to £241 million. Rotarix sales were down 18% to £235 million, as the product continues to recover market share lost following its temporary suspension from several markets earlier in the year.

Relenza sales were £121 million (2009: £720 million), down 84%, against the previous year where significant government orders were received.

Dermatology sales were £1,087 million, including heritage GSK products and those acquired through business acquisitions, principally Stiefel in July 2009. The estimated sales growth in 2010 for the business on a pro-forma basis (excluding 2010 acquisitions) is approximately 6%. In addition, GSK’s heritage consumer dermatology portfolio, reported within Consumer Healthcare, contributed sales of £256 million (+8%).

Other strong pharmaceutical performances during the year included Tykerb (+34% to £227 million), Arixtra (+19% to £301 million), Avodart (+18% to £629 million), and Lovaza (+17% to £530 million). Newly launched oncology products Votrient and Arzerra delivered sales of £38 million and £31 million, respectively.

Valtrex sales (-60% to £532 million) were impacted by generic competition in the USA and Europe. Boniva's reported sales of £78 million were down 69%, primarily reflecting the transfer to Genentech of the exclusive promotion rights in the USA on 1st January 2010. Reported sales of Wellbutrin declined 39% to £81 million, reflecting the sale of Wellbutrin XL in the USA to Biovail in Q2 2009.

Avandia sales declined by 44% to £440 million. On 23rd September 2010 the European Medicines Agency suspended marketing authorisation for all Avandia containing products and the US Food and Drug Administration announced additional measures to ensure continued safe use of Avandia, including a Risk Evaluation and Mitigation Strategy (REMS) programme. As a result, GSK expects global sales of Avandia containing products to be minimal in the future.

Sales of HIV products by ViiV Healthcare were down 3% to £1.6 billion. Sales of the former Pfizer products Selzentry and Viracept (combined sales of £118 million) and growth from Epzicom/Kivexa (+1% to £555 million) partially offset reductions in the sales from other HIV products including Trizivir (-28% to £144 million) and Combivir (-16% to £363 million).

GlaxoSmithKline - one of the world's leading research-based pharmaceutical and healthcare companies - is committed to improving the quality of human life by enabling people to do more, feel better and live longer.

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