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LONDON GlaxoSmithKline (GSK) received a boost on Monday from a decision by Express Scripts, the largest U.S. pharmacy benefit manager, to reinstate its top-selling lung drug Advair as an approved drug in 2015.
The British drugmaker's business has suffered since January after Advair was dropped from various formulary lists, including that of Express Scripts, adding to pressure on an inhaled medicine that is also facing growing price competition from rival products.
Drugs excluded from such lists have to be paid for out of patients' pockets, hitting their use. Pharmacy benefit managers administer prescription drug benefits for employers and health plans.
Disappointing U.S. sales of GSK's 15-year-old respiratory drug were largely to blame for the company's worse-than-expected second-quarter results, which prompted the company to cut its 2014 earnings outlook last month.
Advair makes up nearly a fifth of GSK's sales but demand is eroding both in Europe, where it faces competition from copycat versions, and in the United States, due to lack of formulary cover and keen competition from AstraZeneca's Symbicort.
U.S. sales of Advair, which is used to treat asthma and chronic lung disease, tumbled 19 percent in the second quarter in constant currency terms.
Even after the Express Scripts change, however, Advair will still be at a disadvantage, according to Credit Suisse analysts, since it is not listed as a preferred treatment, unlike Symbicort and Merck & Co's Dulera.
The analysts also believe Advair prices are likely to remain under heavy pressure as GSK strives to secure market share.
Furthermore, GSK's new lung drug Breo remains excluded from the Express Scripts formulary, along with its new injectable diabetes drug Tanzeum, which belongs to the same so-called GLP-1 class as Novo Nordisk's Victoza.
Victoza was already excluded from the list but GSK has been hoping to win business for its rival medicine by pricing Tanzeum at a discount to Victoza.
GSK shares were 1.3 percent higher by 10.00 a.m. EDT.
Express Scripts also said late on Friday it would drop two key anemia drugs, Epogen and Aranesp, sold by Amgen.
(Editing by David Holmes)
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