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Pharmaceutical giant GlaxoSmithKline (GSK) has warned it expects to be hit this year by lower sales of its diabetes treatment Avandia and heavier competition from rivals.
Back in May, Avandia was hit by claims – which were strongly denied by GSK – that the drug increased the risk of heart attacks.
The company also said it faces heavier generic competition to products such as Wellbutrin and Coreg, which treat depression and hypertension.
Chief executive Jean-Pierre Garnier said: “The decline in Avandia sales, together with increased generic competition in the USA, will adversely impact our earnings in 2008.”
The group saw US sales of Avandia slump 29% to £780m last year, with overall sales of the treatment falling 25% to £1.2bn.
And the impact of generic rivals added to a 3% fall in US pharmaceutical sales to £9.3bn, while the pound’s strength against the dollar left the group’s overall revenues down 2% to £22.7bn.
This came even though sales of its best-selling drug, the asthma treatment Seretide/Advair, rose 10% to £3.5bn.
The group has embarked on a cost-cutting programme which is designed to save £700m a year by 2010, and it said the savings would partly offset the impact of the competition from generics and Avandia sales this year.
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