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Wednesday, May 30, 2007

GSK hit as Avandia market share slides after health scare

It seems the writing is on the wall for GlaxoSmithKline

Source: The Independent 30th May 2007

Doctors have virtually stopped prescribing the GlaxoSmithKline diabetes pill Avandia in the wake of a health scare, and frightened patients are abandoning a long-term trial of the drug that is aimed at proving its safety.

GSK has become so alarmed at the threat to the 4,400-patient safety study that it is examining ways to persuade volunteers to stick with the drug.

The company has found itself at the middle of a political and public relations firestorm after an academic study found that Avandia dramatically increased the risk of heart attacks among users. While the company insists the study is flawed, and US regulators have told patients not to panic, there is growing evidence that sales are being significantly hit.

Analysts were yesterday poring over prescription data from the days after the study was published in the New England Journal of Medicine last Monday. Avandia's weekly market share of prescriptions for new diabetes patients fell from 10 per cent before publication to 6 per cent for the week to 23 May.

Pharmaceuticals analysts at Deutsche Bank said that meant that Avandia's market share has fallen to "approximately zero". However, ImpactRx, which collected the data, said it disagreed with that conclusion, and said prescriptions were still being written for Avandia.

GSK shares fell a further 2.1 per cent to 1,306p, and are now down almost 11 per cent since the NEJM study came out. In all, more than £9bn has been wiped off the value of the company.

Two days of prescription data is not enough to reach sensible conclusions on the trend for Avandia new prescriptions, GSK said, adding that the safety of the drug would be vindicated when the Food & Drug Administration, the US drug regulator, convenes an expert panel to examine the issue.

The NEJM study calculated heart attack risk by adding together data from lots of small trials, but both GSK and the FDA say that early data from a 4,400-patient trial specifically designed to measure such risks is "quite reassuring". This so-called "Record" study began four years ago and is scheduled to run until 2009.

Other stories:

Drug Maker Facing Investor Headache (From Sky News)

GlaxoSmithKline has staged a fresh defence of its diabetic drug Avandia amid reports linking the treatment to heart attacks.

The pharmaceutical giant told shareholders at its AGM that research suggesting Avandia increased the risk of heart attacks by 43% was flawed.

The group added it was "confident" the treatment would be vindicated.

GSK's share price fell 5% on Monday after news broke of the research findings and the stock has continued to slide despite assurances from the drug firm

"We remain confident that the significant benefits of the medicine continue to outweigh any treatment risks," GSK chairman Christopher Gent said.

Europe's drug watchdog, the European Medicines Agency, also issued a statement urging patients not to stop treatment with rosiglitazone (Avandia).

It confirmed the drug was kept under "close surveillance" over any possible links to heart risks.

But analyst and investor fears failed to subside, with GSK's share price closing down a further 2%.

Shareholders voiced their anger at the meeting in London over the poor performance of GSK's share price, which has dropped by almost 15% over the past year.

GSK investor John Farmer blasted the group for its "colossal under-performance" and demanded the resignation of chairman Sir Christopher and a more speedy exit for CEO Jean-Pierre Garnier

Mr Garnier is due to step down in May 2008