GSK's Shingrix blows past sales projections, pushing 2018 estimates to $600M

GlaxoSmithKline's Shingrix carried high expectations, but it turns out that those ambitious projections weren't high enough. In the first quarter, the shingles vaccine generated £110 million, nearly triple analyst estimates of £40 million. And the revenue couldn't come at a better time for GSK.

In dollar terms, that's $150 million on a $55 million projection. And that helped boost Glaxo's overall vaccine sales by 13% at constant exchange rates to £1.238 billion ($1.7 billion). With GSK looking down the barrel of Advair generics, and sales of its new drugs mounting far more slowly, that vaccines growth was a welcome addition. Overall, the company's pharma and consumer health divisions chipped in just 2% growth.

Still, vaccines remain the smallest unit at the company by revenue. Pharma sales were £4 billion ($5.51 billion), while consumer healthcare chipped in £1.9 billion ($2.61 billion). 

Glaxo executives said they expect Shingrix sales to continue at a similar clip as the year continues, putting full-year sales at £440 million ($600 million) for the new shot.

RELATED: GlaxoSmithKline's Shingrix launch gets a jump-start with CVS move to stock thousands of pharmacies 

Shingrix rolled out in the U.S. in the fall and, thanks to a CDC committee's vote recommending the GSK jab over Merck's older Zostavax, is expected to quickly pick up market share. Luke Miels, GSK's president of global pharmaceuticals, said last week that initial indications for the launch are "very good." 

"We're rapidly building coverage," he said on the company's first-quarter conference call. "And now more than 90% of patients have access through both Medicare and commercial channels." 

Shingrix's market share is up to 99% in the U.S. as customers stock their shelves with the new shot, based on pharmacy data that represent about 60% of the market. With the strong demand, "low inventory levels" for GSK's own supply are likely going forward, CEO Emma Walmsley added.

But GSK is "very focused on minimizing this and are prioritizing all the actions to supply the vaccine," she said. The company will focus on the U.S. first, with other rollouts to follow.

Elsewhere in the company's vaccine business, meningitis vaccine sales slipped 2% to £180 million for the quarter as Menveo struggled. That vaccine's sales fell 25% at constant exchange rates compared with a very strong first quarter last year, according to the drugmaker, and international supply issues constrained sales. Men B vaccine Bexsero, another vaccine on a growth path, increased sales 13% to £139 million. 

RELATED: GlaxoSmithKline tops its peers with $7.16B in 2017 vaccine sales 

Glaxo has been increasing its presence in vaccines in the last several years. In 2015 it completed a massive asset swap with Novartis, and it climbed to the top of the industry's sales rankings last year. GSK's $7 billion-plus in 2017 vaccine revenues beat Merck's $6.5 billion, Sanofi's $6.25 billion and Pfizer's $6 billion. 

And that performance was without any meaningful contribution from Shingrix, which is among a group of three new launches that are an immediate commercial focus for the company.