Glaxo resumes diabetes drug manufacture

Wed, 12 Jul 2006
GlaxoSmithKline Plc has resumed the sale of the troubled, yet still very profitable, diabetes drug Avandamet. The manufacture of the drug had been halted for repairs following FDA (Food and Drug Administration) intervention. The manufacture of the drug will now be expanded.

Avandamet has faced major manufacturing problems, and consequently hot and cold sales . Many patients lost faith in the drug and switched to other treatments, even influencing the Glaxo stock price. Following orders from the FDA, federal marshals seized shipments of the drug following manufacturing problems at a plant in Puerto Rico . The defective drugs, which apparently contained too much of one active ingredient, were deemed non harmful.

According to Glaxo, the Puerto plant has been reconfigured to only produce drugs under FDA manufacturing rules. Accordingly, costs for making the drug have fallen and the company expect Avandamet revenue to soar as sales and production resume. Avandamet has been stockpiled in large enough quantities to meet demand.

Sales of the drug Avandamet fell to $319 million in 2005 from a high of $410 million in 2004. Profits are expected to climb again at the end of the year.
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