Britain’s top drugmaker, GlaxoSmithKline (GSK), said that it sees better signs for respiratory medicine after the low demand for its drug Advair that hurt its sales for the fourth quarter and made it declare a tough 2014 for the company.
GlaxoSmithKline is also trying to revive its fortunes with it banking on its asset swap with Novartis and the company is planning to unlock value as it lists its HIV unit which is the ViiV Healthcare. According to the sources who familiar with the subject, the drugmaker has hired three banks for advice on the options for its HIV unit.
Meanwhile, Andrew Witty, the chief executive of GlaxoSmithKline is under pressure after his failure to deliver the promise he made that he will put the company back to growth.
The first half of 2015 would be challenging, says GSK but it expects a stronger performance during the second half. It didn’t provide financial forecasts for 2015 but it made a promise that it will brief investors after it closes the deal with Novartis that is worth $20 billion.
In a transaction that is especially designed to make sure that the company gains stability and sustain long-term growth, GSK is selling cancer drug, buying vaccines and forming a consumer health joint venture with Novartis with the deal due to close within the first half of 2015.
The sales of GlaxoSmithKline for the last quarter of 2014 was $6.19 billion pounds which was 8% lower year on year. Meanwhile, its core earning per share that was closely followed by investors went down by 6%.
GlaxoSmithKline has announced its deal with Novartis last October for an initial public hearing of a minority stake in its HIV unit which is the ViiV Healthcare.
If the respiratory franchise is stabilized this year, the company should be able to return to growth according to analysts at Bernenberg Bank, which rate the stock of GlaxoSmithKline as ‘hold’.