GSK sales flat, profit up

GlaxoSmithKline struggled with competition from cheap generic copycats in the first quarter, reporting flat sales while profits were slightly better than analysts' expectations.

The British drug maker, which has its U.S. headquarters in Research Triangle Park, reported $10.97 billion in sales for the three months ended March 31. That was 3 percent higher than the same period a year earlier. Analysts had expected as much as a 15 percent increase, according to Thomson Financial.

Quarterly profit rose 14 percent to about $3 billion, or 52.9 cents per share. GSK said earnings per share were also dented by a weak U.S. dollar. Based near London, the drug maker generates about half of its sales in the United States.

Generic competition was particularly fierce in the United States, causing double-digit decreases in the sales of HIV/AIDS drugs, antidepressant Wellbutrin XL, anti-nausea drug Zofran and allergy treatment Flonase. Excluding the losses to generics, GSK's sales rose 16 percent.

To make up for the generic competition, the drug maker hopes to receive approval from the Food and Drug Administration to start selling 10 new medicines this year.

Among the newcomers are breast cancer pill Tykerb, migraine treatment Trexima and Cervarix, GSK's long-awaited vaccine to protect against cervical cancer.

Trexima is slated to replace Imitrex, a $1.3 billion seller that will lose patent protection in 2008. GSK developed Trexima with Chapel Hill-based Pozen, but the drug has run into regulatory hurdles. The partners submitted additional information in February and a response from the FDA is expected in August.

GSK reported earnings before the market opened. American depositary receipts, which are like stock, closed at $58.81 Tuesday.