Strong sales of specialty medicines during the first half of the year have led GSK to expect group revenue and profit growth towards the top end of its forecast range.
The FTSE 100 company posted total second-quarter sales of almost £8 billion, up 6 per cent at constant currencies and ahead of City forecasts of £7.8 billion.
Specialty medicines rose 15 per cent to £3.3 billion, including cancer treatments up 42 per cent and HIV drug sales 12 per cent. Core operating profit rose 12 per cent to £2.6 billion in the quarter.
The performance led GSK to forecast revenue growth this year towards the top end of its previously guided range of between 3 per cent and 5 per cent. Similarly, it expects core operating profit growth to be towards the top of its 6-8 per cent range.
GSK said its guidance reflected tariffs already enacted and the US-EU trade deal struck this week, adding that it was “positioned to respond to the potential financial impact of tariffs, with mitigation options identified. Given the uncertain external environment, we will continue to monitor developments.”
President Trump reiterated threats on Monday to introduce tariffs on pharmaceutical imports soon as he seeks to pressure multinationals to increase manufacturing in the United States.
A dividend of 16p per share was declared and GSK has spent £822 million of its £2 billion share buyback announced at its full-year results earlier this year.
Shares in GSK rose 4.7 per cent, or 65½p, to close at £14.62p in London yesterday.
President Trump has pressured multinationals to increase manufacturing in the United States
CHRISTOPHER FURLONG/AP
Dame Emma Walmsley, GSK’s group chief executive, said the company continued to make “very good progress in R&D, with three major FDA approvals achieved so far this year, 16 assets now in late-stage development, and four more promising medicines to treat cancer, liver disease and HIV expected to enter phase III and pivotal development by the end of the year”.
GSK, based in the “Knowledge Quarter” in northwest London, is one of Britain’s two big pharma companies alongside AstraZeneca. It employs more than 65,000 people and operates in 75 markets.
The group separated Haleon, its consumer healthcare business, as a standalone FTSE 100 company three years ago to focus on developing its core biopharma pipeline and to give it more firepower for bolt-on deals.
Walmsley, 56, who has led GSK since 2017, said the company remained confident in its long-term outlook. It has set a target of generating group sales of more than £40 billion by 2031. However, there remains scepticism among some investors that GSK will hit that figure, with consensus forecasts of about £34 billion.
GSK suffered a setback this month when the Food and Drug Administration, the regulator in America, the world’s biggest drugs market, delayed a decision on approving Blenrep, a potential blockbuster blood cancer drug. The European Union, however, approved Blenrep for the treatment of adults with relapsed or refractory multiple myeloma. The UK has also given the green light.
GSK remains confident in its long-term outlook despite the FDA delaying a decision on Blenrep, its blood cancer drug
Walmsley said the 2031 group sales target had been upgraded twice since the separation of Haleon “and step by step we have more visibility of the data that’s coming through on the pipeline”.
She added: “I’m pretty sure I can say that all companies have a gap with consensus overall and we’re not that much of an outlier for it. What matters is the numbers are steadily going up, particularly in our two core areas.”
On Monday, it struck a $500 million deal with Hengrui Pharma, a Chinese pharmaceutical company, to develop up to a dozen new medicines as it deepens its partnerships in the country.
GSK said on Wednesday that its agreement in May to pay up to $2 billion for a promising liver disease drug, the lead asset of Boston Pharmaceuticals, a US biopharma company, had completed.
Britain must act to attract foreign investment in life sciences
It is “essential” for Britain to improve the commercial environment for life sciences if it wants to attract foreign direct investment, the chief executive of GSK has said.
Speaking alongside half-year results on Wednesday and following the government publishing its plan for the sector this month under its industrial strategy, Walmsley welcomed ministers recognising its “strategic importance” and measures including incentives around clinical trials and a new Health Data Research Service, a long-awaited initiative designed to transform access to NHS data for medical researchers.
Walsmley, 56, one of Britain’s most senior business leaders, also said GSK was “proud to be a UK-listed and a UK-headquartered company”, where it invests heavily “even if it’s a small part of the business in terms of revenue, but because of the capabilities and the talent”.
Her comments come after Sir Pascal Soriot, the chief executive of AstraZeneca, said on Wednesday that his company was a “very American company” and declined to rule out moving its main stock market listing to the US.
The government is under pressure from multinational pharma bosses to cut the cost of a contentious NHS drug pricing rebate scheme and to loosen restrictions on the approval of new medicines. They have warned it is holding back investment in the UK.
Walmsley said: “Let’s be absolutely clear. For a country to want to have life sciences as a strategic industry, we need a competitive and sustainable commercial market that recognises the value of this innovation. That is absolutely essential. Not just for GSK, but for FDI [foreign direct investment] more generally, it’s really important.”
The Trump administration is seeking to cut the price of medicines in the US compared to other developed nations, which could potentially lead to higher drug prices in the UK.
Walmsley said: “The most important thing in the US is to keep the US leading the world as a source of great innovation.”
She added: “We would like to see all countries investing more and recognising the value that innovation brings — not least to bring down the cost of total healthcare. And I would definitely include in that the UK.”