Natalie Glover and Maggie Fick
LONDON (Reuters) – GSK Chief Executive Officer Emma Walmsley on Wednesday made replenishing drug companies’ vaccines and therapeutics pipelines a top priority.
But analysts were disappointed that she didn’t provide any details about how she and her management plan to find the company’s next blockbuster drug.
After the world’s largest vaccine maker reported stronger-than-expected fourth-quarter results, the current pipeline will continue to grow at the end of the decade and beyond, Walmsley said by phone.
But analysts say there isn’t enough drug cabinets to sustain this momentum over the next few years.
Investors have been listening intently to GKS’ pipeline strategy after it last July spun off Haleon, a consumer health products business that makes Sensodyne toothpaste and other flagship products.
GSK has missed a big opportunity in the lucrative market for COVID-19 vaccines, but has had a strong quarter after years of underperforming relative to its peers.
Fourth-quarter results were boosted by sales of HIV medicines and the blockbuster shingles vaccine Shingrix.
However, after an early surge, GSK’s share of London’s blue chip FTSE 100 closed 0.2% lower.
Barclays analyst Emily Field said: “We didn’t learn much today about their efforts to expand their pipeline.
The loss of patent protection for dolutegravir, a compound that forms part of GSK’s four HIV medicines, by 2027 is of particular concern as more than £5bn ($6.2bn) of sales are at risk will be Third bridge.
Among its few prospects, GSK relies primarily on vaccines targeting respiratory syncytial virus (RSV). RSV causes thousands of hospitalizations and deaths each year, at least partially offsetting the losses.
It has been submitted for regulatory review in the United States, European Union, and Japan.
But rivals Pfizer and Moderna are also competing for a piece of the estimated $10 billion market, and some analysts expect GSK may only get a piece of it, he said. Skeet told Reuters.
“So there’s still room to make up,” he said.
The company has announced several acquisitions, including an agreement to acquire U.S.-based Sierra Oncology in 2022, but it has also ditched its cancer-focused pact and the cell and gene therapy space entirely. We have culled a small number of programs from the pipeline.
GSK has also suffered setbacks in its marketed oncology portfolio in recent months. Meanwhile, analysts say Shingrix’s market will eventually become saturated, further limiting the company’s growth prospects.
GSK’s R&D spending has long lagged its peers, and activist investor Elliott stressed in his 2021 letter that he was pressuring him to make drastic changes. doing.
Citeline senior healthcare analyst Andrew McConaghy says the company is starting to close the gap by spending just over £5bn ($6.2bn) on R&D in 2022, but still rivals Roche, AstraZeneca and Pfizer. lagging behind.
With the help of technologies such as artificial intelligence, GSK’s top scientists can double R&D productivity from the industry standard of 10% to 20%, or reduce the entire journey from early clinical trials to market in 10 minutes. said it is working on using 2 drugs.
Some investors and industry experts say the company still has time to turn around its drug pipeline.
Lucy Coutts, investment director at asset management firm JM Finn, which holds a stake in GSK, hopes the company will eventually offer a streamlined and specialized portfolio of blockbuster drugs.
But until that happens, stocks may continue to be under pressure.
“At this stage, there is little prospect for investors on that,” she said.
($1 = £0.8107)
(Reporting by Natalie Glover and Maggie Fick in London; Editing by Jane Merriman)