GlaxoSmithKline Pakistan Limited (GLAXO) reported earnings per share of PKR 31.48 for CY25, compared to earnings per share of PKR 20.52 in CY24. Furthermore, in 1QCY26, the company reported earnings per share of PKR 8.20, compared to earnings per share of PKR 6.68 in the same period last year (SPLY).
Glaxo is the leading pharmaceutical company in Pakistan by volume, with a 9% market share, and holds a 6% share in terms of value. Total sales reached PKR 66 bn, reflecting an 8% increase YoY. This growth was primarily driven by price adjustments, which offset a 10%–12% decline in sales volumes. Gross profit margins expanded significantly from 25% to 37%, representing a 12 percentage point increase.
This improvement was driven by responsible price adjustments and a series of profit sustainability measures. The product portfolio is led by VATES, contributing PKR 14 bn, followed by Augmentin at PKR 10 bn, while Velosef and Amoxil each contribute approximately PKR 5 billion, whereas Calpol accounts for PKR 4 bn. A key strategic milestone was the launch of Shingrix, a vaccine for adult immunization against shingles.
Management highlighted that adult vaccination represents a new category in Pakistan and is expected to gain traction gradually over time. The revenue mix comprises approximately 45% essential drugs and 55% non-essential drugs. Management attributed the decline in volumes to industry wide pressures, along with specific challenges in KPK and Balochistan. Security concerns and border closures have adversely impacted medical tourism, where patients from Afghanistan previously traveled to these regions for treatment.
These provinces contribute roughly 20% to GSK’s total sales. The company has withdrawn from low margin government tenders to protect profitability and has negotiated discounts with vendors through advanced payment mechanisms. Management has optimized the sales field force and reduced promotional allowances as local profitability improved.
While non essential drugs are now deregulated, essential medicines remain capped at approximately 7% of CPI. Management noted that they are awaiting government approval for 50–60 hardship pricing cases that have remained pending with the regulator for the past three years.
Approximately 80% of API costs are dollar linked. While current API prices remain stable, management cautioned that prolonged geopolitical tensions could impact API prices, whereas, as of now, freight prices have been increased only. Despite the growing shift toward local generics, management remains confident in the company’s brand equity, emphasizing that product quality and trust remain key decision drivers for healthcare providers.
The pharmaceutical sector faces a high effective tax rate , including a 1% Clinical Research Fund levy on gross profits. Management is advocating for rationalization of the tax regime and a more consistent, long term industrial policy to reduce regulatory uncertainty.
Government tenders account for approximately 7%–8% of total sales and are typically concentrated in the fourth quarter due to procurement cycles. GSK sources its APIs from a diversified base, including Europe, China, and India.
Important Disclosures
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