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GlaxoSmithKline’s Vaccines Business

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Vaccines business

GlaxoSmithKline (GSK) is focused on strengthening its Vaccines business, so it’s acquired Novartis’s (NVS) meningitis and other vaccines business.

The growth of the Vaccines segment has been driven by increased sales of Rotarix, Boostrix, newly acquired meningitis vaccines Menveo and Bexsero, and key vaccines such as Infanrix, Pediarix, and hepatitis vaccines.

The above chart shows the revenues of GSK’s Vaccines segment.

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Segment performance

The Vaccines segment reported a rise of 20% at constant exchange rates to 1.6 billion British pounds in 3Q16. The segment’s Novartis acquisition has improved its sales, mainly due to the sales of meningitis vaccines Bexsero in Europe and Menveo in the United States and Europe.

US markets reported a 23% rise in revenue to 725 million pounds in 3Q16. This rise was driven by strong sales of Fluarix and Bexsero in US markets, and it was partially offset by lower sales of Menveo.

The segment’s sales in the European market reported a 10% rise to 389 million pounds in 3Q16. This rise was driven by sales of Bexsero, Boostrix, and hepatitis A vaccines, and it was partially offset by lower sales of Infanrix/Pediarix due to competition.

International market sales rose 25% on a reported basis to 499 million pounds in 3Q16. This rise was driven by sales of Synflorix, Rotarix, Priorix, seasonal flu vaccines, and hepatitis A vaccines, and it was partially offset by falling sales of Infanrix/Pediarix.

A major competitor for GSK’s meningitis products such as Bexsero is Pfizer’s (PFE) Trumenba. Competitor Sanofi Pasteur (SNY) offers the meningitis vaccine Menactra. 

For diversified exposure, investors may want to consider the Vanguard FTSE All-World Ex-US Index ETF (VEU), which has ~6% of its total holdings in GlaxoSmithKline.

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