GlaxoSmithKline’s (GSK) Vaccines segment includes vaccines for various therapeutic areas, including hepatitis, influenza, meningitis, and others. The segment reported a 16.0% operational growth and a 15.0% positive impact of foreign exchange, resulting in a 31.0% rise in reported revenues to 1.2 billion pounds in 1Q17.
The above graph shows revenues for the Vaccines segment over the past nine quarters.
Performance of the Vaccines segment
The rise in 1Q17 revenues for the Vaccines segment was due to strong sales of Rotarix, Boostrix, and meningitis vaccines Menveo and Bexsero. Other important vaccines included Infanrix, Pediarix, and hepatitis vaccines.
The meningitis vaccines—Menveo and Bexsero—were acquired from Novartis in 2015. They have reported strong performances in European and international markets. Bexsero has reported strong sales in US markets as well.
Revenues from US markets reported a rise of more than 39.0% in 1Q17 to ~363.0 million pounds. Growth in US markets is driven by the strong performance of the meningitis vaccine Bexsero and the strong performance of established vaccines such as Infanrix, Pediarix, and Boostrix. The revenues include a 21.0% operational growth and an 18.0% positive impact of foreign exchange. The influenza vaccines portfolio reported weak sales in 1Q17.
European markets reported a 15.0% growth to 389.0 million pounds in 1Q17. Growth in European markets was driven by the strong performance of vaccines such as Bexsero, Boostrix, the hepatitis A vaccine, Synflorix, and others. Lower sales of Infanrix and Pediarix due to competition partially impacted revenues for the European markets. Revenues include a 4.0% operational growth and an 11.0% positive impact of foreign exchange.
Revenues for the international market rose ~42.0% to 400.0 million pounds in 1Q17, driven by the strong performance of Bexsero, Boostrix, Infanrix/Pediarix, and hepatitis vaccines. Revenues include a 25.0% operational growth and a 17.0% positive impact of foreign exchange in 1Q17.
To divest the risk, investors can consider ETFs such as the Vanguard FTSE Developed Markets ETF (VEA), which holds 0.80% of its total assets in GlaxoSmithKline. VEA also holds 0.80% of its total assets in Sanofi (SNY), 1.6% in Novartis (NVS), and 0.70% in Novo Nordisk (NVO).