GlaxoSmithKline today posted a forecast-beating 20 per cent rise in quarterly earnings per share today and said it was accelerating preparations to supply bird flu vaccine in the event of a pandemic.
Europe's largest drug maker said it was building capacity and converting more of its factories to make a pandemic flu vaccine, as it develops a prototype H5N1 shot.
It also plans to increase output of the anti-flu drug Relenza and is offering free licences to partners able to produce the inhaled treatment. Relenza, like Roche's Tamiflu, is not a cure but reduces the severity of influenza.
Strong demand for its top-selling asthma drug Advair and diabetes medicine Avandia, coupled with tight control of costs, lifted earnings to 21.3 pence per share in the third quarter, as sales rose 11 per cent to £5.47 billion ($9.78 billion).
The upbeat results allowed Glaxo to raise its financial outlook, predicting mid-teens percentage growth in 2005 EPS, from low double-digits forecast previously, when measured at constant currencies.
Shares in the British-based group have rallied around 25 per cent in the past year on growing hopes for a pipeline of drugs that includes several tipped by analysts to become multibillion-dollar sellers.
The stock added a further 2.2 per cent to £14.26 by 12.10pm, outperforming the European drugs sector, which was off 0.1 per cent.
"Glaxo is better than expected. We expect earnings upgrades," said John Smith, investment director at Brown Shipley.
"I think we're looking at a good drugs pipeline over the next few years." Glaxo said it would give an update on drugs in development for cancer at a seminar for investors in New York on November 30th.