Shingles vaccine good news as GSK boosts outlook

Drugmaker GlaxoSmithKline (GSK) has upgraded its earnings forecast as its shingles vaccine performed much better than expected, for the second time in a year.

Shingrix grew nearly 90% to £535 million as it continued to expand in the US, boosting overall vaccines turnover by 20%.

Partly as a result, total revenue hit £9.39 billion, compared to the £9.04 billion analysts had forecast.

Adjusted earnings per share (EPS) were 38.6p in the quarter, compared to the 33p analyst consensus.

The company now expects its full year earnings to be flat after it told shareholders in July to be wary of a 3% to 5% drop.

GSK has already upgraded its outlook once this year on a strong performance from Shingrix.

Investors rewarded the news, sending shares up as 2.9% to 1,788.2p in the minutes after the results, their highest point in years.

“GSK has made further good progress in the third quarter, with sales growth across all three businesses, and we have today upgraded our full-year EPS guidance,” chief executive Emma Walmsley said.

“This quarter we have continued to strengthen our pipeline and have advanced assets in Respiratory, HIV and, notably, Oncology, where we are on track to file three innovative medicines by year end, following positive pivotal trial data.”

Sales of the company’s HIV treatment increased by 5% to £1.3 billion, a welcome reprieve after strong competition pushed sales down 2% in the second quarter.

Ms Walmsley, who took the job in 2017, has led a bid to break up parts of the business, which has pushed her to throw GSK’s consumer health division into a joint venture with Pfizer, a US rival.

“We … achieved a significant milestone with the completion of our new consumer healthcare joint venture with Pfizer, to create a new world leading consumer healthcare business,” she said.

Bosses hailed the company’s results as Ms Walmsley’s push for more research and development spending seemed vindicated.