Big Pharma Earnings Watch: Glaxosmithkline and Amgen
Big Pharma’s Earnings Keep Rising Off of Price Hikes
To no one’s surprise, two more brand name drug manufacturers, GlaxoSmithKline (GSK) and Amgen both topped earnings expectations for the third quarter of 2019 this week after hiking prices on their products earlier this year. Of the Big Pharma giants who have announced Q3 earnings so far, every single one has surpassed expectations after continuing to increase prices on struggling Americans.
- GSK’s profits rose to £2.8 billion (about $3.6 billion), ahead of market expectations.
- The company’s shares rose to their “highest levels in 17 years.”
- For the second time this year, GSK increased its annual profit forecast thanks to better than expected sales of shingles and HIV medications.
- Pharmaceutical sales increased to £4.5 billion in Q3 due to strong sales of respiratory drugs like Trelegy Ellipta.
- Amgen reported third-quarter profit of $1.97 billion with revenue of $5.74 billion, beating Wall Street forecasts.
- The drug company boosted its expected full-year adjusted earnings to between $22.8 billion and $23 billion.
- Sales of its biosimilar drugs rose from $173 million from $82 million last quarter.
- Product sales for the popular osteoporosis drug Prolia rose by “double digits or better.”
Both companies enjoyed higher than expected earnings after implementing a series of price hikes earlier this year, despite the fact that one-in-four Americans are unable to afford their prescription medication.
- Just this year, GSK jacked-up prices 61 times, including on respiratory drug Trelegy Ellipta, which helped bolster the company’s pharmaceutical sales this quarter. These price hikes come after The Wall Street Journal reported in January that the company would raise prices on dozens of the drugs in its portfolio.
- This summer, GSK announced it was raising the price of their ovarian cancer drug Zejula. The price of a 30-day, 100mg supply of Zejula rose five percent from $6,567 to $6,913. When the drug was first approved by the FDA in 2017, it cost $4,917.
- Price hikes on the company’s cancer drug Neulasta were not supported by new clinical evidence and accounted for an unnecessary increase in U.S. drug spending of nearly $500 million from 2017-2018 according to ICER.