With the swine flu pandemic grabbing headlines and scaring countries the world over, GlaxoSmithKline says that it expects to reap up to $2.1 billion next year from the sale of a new H1N1 vaccine. And it's already tripling its capacity to supply the antiviral Relenza as it dickers with about 50 countries over their plans to buy stockpiles of meds to fight the flu.
Glaxo projected $573 million in Relenza sales by the end of this year. And Glaxo says that the demand for flu meds should keep swelling its revenue stream for several years to come.
"In these last three months, governments have rapidly strengthened their pandemic stockpile and prevention strategies," said GlaxoSmithKline's chief executive, Andrew Witty. In some cases the talks are at a "very advanced stage. While we are currently seeing a heightened period of demand, it is likely that we will see a sustained level of orders for pandemic products over the next few years."
Like other vaccine manufacturers, GlaxoSmithKline says that it's work on a new vaccine has been slowed due to low yields of antigen. But Glaxo says that it should be able to supply governments with what they need by early 2010.
Analysts note that the pandemic couldn't have come at a better time for Glaxo, one of the world's largest vaccine makers. Generics have been steadily eating into the company's margins, leaving Glaxo looking for new products to make up the shortfall.
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