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After GlaxoSmithKline announced its plans to produce 1 billion doses of a vaccine adjuvant next year, the GSK stock price started to rise.
British multinational pharmaceutical GlaxoSmithKline Plc (NYSE: GSK) said it is planning to produce 1 billion doses of a vaccine adjuvant. This is a kind of a medicinal booster that can help any brand of a shot by supporting immunization against the coronavirus pandemic next year.
Meanwhile, GlaxoSmithKline (GSK) stock is up 1.25% now. Its price in the pre-market is $41.45.
The adjuvant can decrease the quantity of vaccine required per dose, be giving more people a possibility to be immunized, and, therefore, making longer-lasting immunity. The U.K. drugmaker already in April decided to give its technology to help develop an experimental vaccine with French pharma giant Sanofi SA (NASDAQ: SNY).
Glaxo is amidst dozens of companies that found themselves chasing the cure for coronavirus. Now, a vaccine is seen as the key to preventing the pandemic spread and reopening economies around the globe. The global death toll has climbed past 357,000. According to the last information, the number of overall infections stands at 5.8 million with 2.5 million people being reportedly recovered.
GlaxoSmithKline Vaccine Adjuvant Will be Produced In Europe, Canada and U.S.
The London-based company said it intends to produce the adjuvant at sites in Europe, Canada and the U.S. It has already started with its production after reviewing its supply network and finding it could widen capacity.
Glaxo however doesn’t expect to earn anything from COVID-19 vaccine efforts during the outbreak, investing any gains to support research and long-term pandemic alertness.
Chief Executive Officer Emma Walmsley last month stated that the goal of the Sanofi pact is to make hundreds of millions of doses annually by the end of next year. In a collaboration with the Coalition for Epidemic Preparedness Innovations, Glaxo also agreed to share its know-how with other vaccine developers, starting with the University of Queensland in Australia.
Higher Core Earnings Reported
The company however had a little bit higher earnings than it was previously expected. Glaxo reported core earnings of 93 cents per American depositary share in the first quarter of 2020, which beat our consensus estimate of 79 cents. Core earnings surged 26% year over year at constant exchange rate (“CER”).
Revenues were up 19% year over year at CER to $11.26 billion (£9.1 billion). Revenues also beat the Zacks Consensus Estimate of $10.95 billion.
Sales in the Vaccines segment surged 19% at CER while Consumer Healthcare sales increased 46%. Growth in the Consumer Healthcare segment was heavily driven by consumer and government responses to the COVID-19 pandemic. Pharmaceuticals sales were also up 6% at CER. The Respiratory segment increased by 38% at CER. HIV product sales were up 8% at CER.
Based on its current assessment of COVID-19 impact, Glaxo maintained its previous guidance for adjusted EPS to decline 1% to 4% at CER, year over year, in 2020. However, it will be updated later, if needed.
GlaxoSmithKline Pharmaceuticals MD Sridhar Venkatesh said:
“Despite the headwinds caused by COVID-19 during Q4, I am pleased with our overall performance during the year. Keeping patient safety at the core, GSK continues to serve the patients through a dedicated workforce that has ensured continued production and supply of medicines across the country during such challenging circumstances.”
Read more about the COVID-19 vaccine progress in our coronavirus news section.