GLAXO U.S. SALES TOP $ 1 BIL. IN FY 1988 TO COMPRISE ALMOST 40% OF CORPORATE VOLUME; ZANTAC LIFTS GLAXO TO WORLD's SECOND LARGEST Rx FIRM BEHIND MERCK

Executive Summary

Glaxo's annual U.S. sales volume increased 37% during the 12 months ended June 30 and surpassed $ 1 bil. for the first time in company history. "Growth in the U.S. continues to be outstanding, as sales increased 37% in dollars to $ 1.3 bil, compared with $ 937 mil. in fiscal 1987," the British firm noted in a Sept. 19 press release. "Glaxo's U.S. subsidiary, Glaxo Inc., is ranked in the top ten of the U.S. pharmaceutical industry and contributed about 36% of total group sales in sterling terms." Glaxo said that while its anti-ulcer product Zantac "continues on its extraordinary path of growth," the company sustained higher rates of sales growth in the respiratory and antibiotic areas, "in some cases with products which were introduced into the market many years before Zantac." Sales increases were achieved in all therapeutic categories, Glaxo added. Overall corporate volume was up 26% in terms of U.S. dollars, to $ 3.5 bil. while net earnings approached the $ 1 bil. mark, rising 22% to $ 976 mil. However, in terms of British pounds, worldwide sales and net income reflected 12-month gains of 18% to (BRITISH POUND)2.1 bil. and 15% to (BRITISH POUND)571 mil, respectively, the result of a declining dollar against the British pound in fiscal 1988. The firm also noted that during fiscal 1988, Glaxo became "the world's second largest pharmaceutical company," behind Merck. A higher level of R&D activity resulted in a 50% increase in R&D expenditures to (BRITISH POUND)230 mil. ( $ 393 mil.). However, Glaxo said that the increase was "an exceptional rise" and that R&D spending was not expected to continue at that rate. Chart omitted.