FDA restrictions on Advair impacts GlaxoSmithKline shares

• MONDAY, NOVEMBER 21, 2005 LONDON Shares in GlaxoSmithKline fell more than 4 percent on Monday after the U.S. Food and Drug and Administration proposed restrictions on the use of Advair, the British pharmaceutical maker's top-selling asthma drug.
• The drug agency said on Friday that Advair, which is sold in Europe under the name Seretide, should not be given as initial treatment for asthma but only after other medicines had proved inefficient.
• The move by the FDA followed the release of results from a clinical study that showed that drugs that contain long-acting beta agonists, or LABAs, can sometimes trigger severe asthma attacks and death.
• It revised its U.S. sales expectations for Advair to £2.24 billion, or $3.85 billion, by 2010, down from a previous forecast of £2.93 billion.
• Worldwide sales of Advair totaled £3.43 billion last year, making it Glaxo's best-selling product.
• Glaxo has been counting on Advair to drive its business in the next few years, until some of its experimental drugs have proved themselves in clinical trials and reached the market.
• Analysts at Morgan Stanley said that more than 25 percent of Advair use in the United States fell under the definition of initial use, rather than after other drugs showed themselves to be ineffectual.
• Current U.S. guidelines recommend steroids and LABAs as initial therapy for moderate to severe-persistent asthma.
• The new FDA warnings also will affect drugs like Serevent, the LABA component of Advair used by Glaxo, which the company also sells as a separate drug.
• They are also expected to affect Foradil, which is made by Novartis.
• Drugs like Singulair, an oral treatment made by Merck, and Asmanex, a long-acting inhaled steroid by Schering-Plough, are among those who could see their market share increase.