(London, UK – February 10, 2011)
GlaxoSmithKline (GSK) posted Thursday a net loss of 690 million pounds ($1.12 billion) after taking a 2.2 billion pound charge for the Avandia settlements.
GSK is the world’s third leading pharmaceutical company with over 90,000 employees all around the world. It has a portfolio of products for major diseases like asthma, cancer, virus control, infections, mental health, diabetes and digestive conditions.
On Thursday, the company posted a net loss for the three months-ending on December 31, 2010, compared with a profit of 1.63 billion pounds from the previous year. Its revenue, on the other hand, fell as much as 13 percent to 7.19 billion pounds. As a result, the company announced that it will reinstate its share buyback program.
Analysts said that the decline in profits for the pharmaceutical company was brought by the various lawsuits filed against its popular drugs like Avandia and Paxil. On January 31, GSK took 2.2 billion pounds from its reserve to settle claims relating to Avandia and past U.S. litigation over the sales practices of the product. Avandia is an oral anti-diabetic agent which acts primarily by increasing insulin sensitivity.
This drug was marketed by GSK as a stand-alone, which improves glycemic control while reducing circulating insulin levels. In 2007, the U.S. Food and Drug Administration (FDA) began an investigation of the drug, which according to several meta-analyses is associated with an increased risk of myocardial ischemic attacks. Later that year, the federal department added a black box warning on the drug, stating therein its contraindications to patients with symptomatic heart failure.
In 2008, GSK was ordered to withdraw due to the Avandia side effects, alongside the accusations that the company allegedly concealed the drug’s health risks at the time when they were trying to win FDA approval. Those who used Avandia and later developed heart problems were advised to contact an Avandia attorney to help them file an Avandia lawsuit against GSK, and provide legal assistance on how to claim compensation for medical costs and other losses.