SHARES in British pharmaceuticals giant Glaxosmithkline slid more than two per cent yesterday after the firm revealed a 10 per cent drop in first-quarter sales, and its chief executive played down the chance of a so-called white knight bid for AstraZeneca.
Sir Andrew Witty said he still prefers targeted transactions rather than mega-mergers. UK rival AstraZeneca is currently the focus of a potential £60bn takeover by US firm Pfizer, yet Witty suggested there is little chance of Glaxo entering the fray
“What we are focused on is ensuring that our organisation is not distracted in the core research and development (R&D) business,” Witty said.
“It is not appropriate for me to get into commentary on this particular transaction that is potentially going on around us, but obviously if there was anything specific that we were thinking of I would absolutely be obliged to tell you about it.”
Witty’s company last week revealed a range of deals with fellow pharma giant Novartis that will see more than $20bn (£11.8bn) in assets traded between the firms.
Glaxo’s first quarter results point to the pressures that are prompting pharma companies to make deals.
Sales fell 10 per cent, excluding the effect of divestments, to £5.61bn, while core operating profit of £1.53bn was down 18 per cent on the same period a year ago.
Revenues fell 10 per cent in the key US market, reflecting a 20 per cent underlying drop in sales of Advair, a respiratory medication.
Income from China continued to be hit by one of several bribery investigations, sinking by 20 per cent in total.