STOCKS NEWS EUROPE-Glaxo slips on new asthma drug warnings

Posted on Mar 4, 2010 in Uncategorized

STOCKS NEWS EUROPE-Glaxo slips on new asthma drug warnings

Fri Feb 19, 2010 3:20am EST

Stocks

GlaxoSmithKline PLC
GSK.L
1,234.50p
-9.00-0.72%
8:13am EST
AstraZeneca PLC
AZN.L
2,824.50p
+27.00+0.97%
8:14am EST
Novartis AG
NOVN.VX
CHF59.85
+0.85+1.44%
8:14am EST

GlaxoSmithKline (GSK.L) shares fall 1 percent after the U.S. Food and Drug Administration takes steps to cut the use of certain asthma drugs because of serious health risks, hitting prospects for the company’s top-seller Advair.

The move also affects products from AstraZeneca (AZN.L) and Novartis (NOVN.VX), but Glaxo is most vulnerable because its two-in-one inhaler is the market leader, with global sales of $7.8 billion in 2009.

Analysts at Morgan Stanley say the tighter rules are likely to push Advair volume growth back into negative territory.

“We see a likely worst-case impact as up to around 3 percent downgrade to 2011 sales and around 7 percent impact to EBIT,” they say in a note. Glaxo also faces a key Advair patent trial in Germany on Feb. 23.