Shingrix crashes for GlaxoSmithKline as vaccination slows amid COVID-19

shingrix
Because of a sharp decline in shingles vaccine Shingrix amid the COVID-19 pandemic, GlaxoSmithkline’s vaccines business saw a year-over-year sales decline of 29% in the second quarter. (GlaxoSmithKline)

Shingles vaccine Shingrix has been GlaxoSmithKline’s star growth driver since its introduction in the fall of 2017, so much so that the British pharma was struggling to produce enough doses to meet surging demand.

But thanks to COVID-19, that’s changed.

The light of the vaccine star was dimmed in the second quarter, as sales of Shingrix plummeted by half compared with the first quarter. The vaccine brought in just £323 million ($419 million) in the second quarter after COVID-19 lockdown measures impeded doctor visits and hurt vaccination rates especially in the U.S., GSK said Wednesday.

Because of lower demand, the vaccine is no longer listed on the Centers for Disease Control and Prevention's (CDC’s) shortage roster. Plus, GSK now has the bandwidth to support an official launch in China at the end of June, more than a year after its approval in the emerging market, where an estimated 1.56 million cases of shingles occur each year in people 50 years and above.

Shingrix isn’t the only GSK vaccine that suffered during the pandemic. Overall, GSK’s vaccines business saw a year-over-year decline of 29%, to £1.13 billion ($1.47 billion) in the second quarter as products for DTPa, hepatitis and meningitis all declined sharply.

Pediatric vaccination is now back to pre-COVID-19 levels, while adolescent and adult immunization—such as that for Shingrix—remains further behind, GSK CEO Emma Walmsley said during a conference on Wednesday.

“Despite lockdown impact on vaccination rates, we believe the underlying demand for our key vaccines, including shingles and meningitis, remains very strong,” Walmsley said. “Guidance from government agencies, including the CDC, is emphasizing the importance of routine immunizations and catch-up for all age groups.” While GSK expects vaccination to recover, Walmsley acknowledged the timing is uncertain.

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The world’s now keeping a close eye on the company’s Sanofi-partnered experimental COVID-19 shot, which the pair intends to roll into clinical trials in September. The vaccine combines GSK’s pandemic vaccine adjuvant AS03 with Sanofi’s recombinant DNA platform. The use of an adjuvant could potentially reduce the dosing required to induce an immune response, allowing drugmakers to deliver more shots, GSK argues.

GSK aims to produce 1 billion doses of the adjuvant in 2021, Walmsley said. The company’s offering the booster to at least seven experimental shots against the novel coronavirus.

COVID-19 may have already boosted one part of GSK's business, though. As a highly infectious respiratory disease, it’s especially threatening to patients with existing respiratory conditions. That could partially explain why GSK’s respiratory sales jumped 16% at unchanged exchange rates to £883 million ($1.15 billion) in the second quarter.

Trelegy sales of £194 million ($252 million) marked 58% growth at constant currencies and met industry watchers’ expectations for the triple-combo inhaler. GSK is waiting for an FDA decision on expanding Trelegy’s use in asthma, but AstraZeneca’s rival triplet Breztri just won a go-ahead to compete in COPD.

Meanwhile, GSK’s HIV products declined 2% to £1.19 billion in the second quarter, partly due to unwinding the COVID-19 stockpiling that drove up first-quarter sales. GSK is counting on its newer two-drug regimens to challenge Gilead’s leading position in HIV. In the second quarter, two dual-drug therapies—Juluca and Dovato—contributed £181 million to GSK’s top line, in line with consensus.

Although the pandemic has slowed patient-switching and new diagnosis, the two meds still managed to increase new-to-brand market share to 9% in the U.S., Walmsley said, adding that the company expects the speed will accelerate when the health situation normalizes.

Besides, the company has resubmitted its application for long-acting two-drug injectable Cabenuva to the FDA and expects a verdict in the first quarter next year. The agency previously declined to approve the med because of manufacturing-related issues.

In GSK’s newfound interest, oncology, PARP inhibitor Zejula sold £77 million in the second quarter, about 9% below expectations, a disappointment that GSK pharma chief Luke Miels attributed to inventory shifts.

All told, GSK’s second-quarter group sales were £7.6 billion, having dropped 10% at constant currencies on a pro-forma basis—that is, counting Pfizer’s consumer health portfolio as if it were already part of GSK the same period last year. It maintained its full-year guidance for adjusted earnings but warned that its numbers depend on the timing of recovery in vaccination rates.

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