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GlaxoSmithKline’s Global Pharmaceuticals’ Performance in 4Q17

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Mar. 20 2018, Updated 10:31 a.m. ET

Global Pharmaceuticals

GlaxoSmithKline’s (GSK) Pharmaceuticals segment includes respiratory products, HIV (human immunodeficiency virus) products, immuno-inflammation products, and established pharmaceutical products. The Global Pharmaceuticals business, excluding the HIV products portfolio, reported revenues of ~4.5 billion pounds during 4Q17, a ~1% decline compared to 4Q16, driven by the negative impact of foreign exchange.

The above chart compares revenues for some of the key products in Global Pharmaceuticals since 1Q17.

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Performance of Global Pharmaceuticals

GSK’s respiratory franchise reported revenues of ~1.9 billion pounds during 4Q17, a ~1% decline compared to 4Q16, driven by a 3% negative impact of foreign exchange and partially offset by a 2% growth in operating revenues. During 4Q17, US sales decreased ~4% to ~1 billion pounds, while sales in European markets increased ~6% to ~382 million pounds, and international sales increased ~1% to ~508 million pounds. Growth was due to an increase in sales of Anoro Ellipta, Arnuity Ellipta, Incruse Ellipta, Relvar/Breo Ellipta, and Nucala, substantially offset by lower sales of Flixotide/Flovent, Seretide/Advair, and other drugs in the franchise.

The immuno-inflammation franchise includes Benlysta, which saw an increase in sales of ~10% to ~97 million pounds during 4Q17, including a ~15% growth in revenues at constant exchange rates, offset by a ~5% negative impact of foreign exchange. US sales increased ~8% to ~87 million pounds, while sales in the European markets increased to ~7 million pounds, and international sales increased to ~3 million pounds.

The Established Pharmaceuticals franchise reported revenues of ~1.4 billion pounds during 4Q17, a ~9% decline compared to 4Q16. The decline was driven by lower sales of Avodart, Augmentin, Coreg, Eperzan/Tanzeum, Imigran/Imitrex, Requip, Seroxat/Paxil, Serevent, and other drugs, partially offset by growth in sales of dermatology products, Valtrex, and Zeffix. The divestiture of the Romanian distribution business during 4Q16 and the anesthesia and thrombosis businesses to Aspen during 1Q17 also impacted growth.

The BLDRS Europe Select ADR ETF (ADRU) holds 20.9% of its total investments in Healthcare companies. ADRU holds 2.6% in GlaxoSmithKline (GSK), 2.5% in AstraZeneca (AZN), 0.5% in Teva Pharmaceutical (TEVA), and 2.7% in Sanofi (SNY).

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