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Drug firm GlaxoSmithKline has reported falling profits after the European ban of diabetes drug Avandia.
The drug was suspended last month by European regulators after research linked the treatment to an increased risk of heart attack.
Strict restrictions were also placed on Avandia in the US.
The firm saw sales fall by 2% in the third quarter to September 30 to reach £6.8 billion.
Its third quarter results were also impacted by price cuts to remain competitive following US health reforms, as well as slower business across Europe due to government austerity measures – together knocking around 2% off sales, the group said.
Pre-tax profits fell 10% to £1.97 billion in the quarter.
Results show sales of Avandia plunged 56% to £70 million and the group expects global sales of around £100 million to £150 million in the second half, falling to “minimal” levels thereafter.
Andrew Witty, chief executive of Glaxo, said last month’s decision on Avandia helped reduce regulatory uncertainty surrounding the drug, but added there were further difficulties to face in the pharmaceutical industry.
“Clearly our operating environment is challenging and the measures being put in place by governments to reform healthcare and reduce deficits are impacting our performance along with others in our sector.”
Copyright Press Association 2010
