) announced that the US Food and Drug Administration (FDA) approved
its combination vaccine MenHibrix (meningococcal groups C and Y and
Haemophilus b tetanus toxoid conjugate vaccine) for treating
children aged between six weeks and eighteen months. The FDA
approved MenHibrix, which is administered in a in a four-dose
regimen, for the prevention of invasive disease caused by Neisseria
meningitidis serogroups C and Y and Haemophilus influenzae type
The approval came on the basis of data from trials conducted
over seven years in the US, Mexico, Australia, Belgium and Germany.
The trials enrolled a total of 7,521 infants and toddlers and they
received at least one dose of MenHibrix.
We note that Glaxo received the approval in its third attempt.
The company received Complete Response letter (CRL) from the FDA
twice, in September 2011 and June 2010 asking for additional
The MenHibrix approval strengthens Glaxo's vaccine portfolio,
which includes Cervarix for cervical cancer and Rotarix for
rotavirus gastroenteritis. Glaxo's total vaccine sales increased 1%
(on constant currency basis) year over year to £758 million in the
first quarter of 2012.
We currently have a Neutral recommendation on Glaxo. The stock
carries a Zacks #3 Rank (Hold rating) in the short run. A major
part of Glaxo's revenues will be exposed to generic competition as
multiple drugs are scheduled to lose exclusivity in the next few
We expect the company's top line as well as gross margins to
remain under pressure in the coming quarters. In addition to
generic competition, EU pricing pressure will continue to affect
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