Reshaping the HIV treatment and prevention landscape
Basis of preparation, assumptions and cautionary statement
gsk
Assumptions relating to the 2021-2026 sales and adjusted operating profit growth
outlooks, 2026 cash generated from operations outlook, 2031 sales ambition and 2021-
2023 dividend expectations
In outlining the growth outlooks for the period 2021-2026, the 2026 cash generated from
operations outlook, the 2031 sales ambition and the 2021-2023 dividend expectations (the
"Relevant Statements"), GSK has made certain assumptions about the healthcare sector
(including regarding possible governmental, legislative and regulatory reform), the different
markets and competitive landscape in which it operates and the delivery of revenues and financial
benefits from its current portfolio, its development pipeline of drugs and vaccines, its restructuring
programmes and its plans for the separation of Consumer Healthcare, details of which are set out
in this document.
GSK expects and assumes the next several years to be challenging for the healthcare industry
with continued uncertainty related to the impact of the COVID-19 pandemic on adult vaccinations
and continued pressure on pricing of pharmaceuticals. GSK assumes no premature loss of
exclusivity for key products over the period. GSK also expects volume demand for its products to
increase, particularly for Shingrix in the US, as healthcare systems are expected to return to
normal following disruption from governments' prioritisation of COVID-19 vaccination programmes
and ongoing measures to contain the pandemic, and for Shingrix in China.
The assumptions underlying the Relevant Statements include: successful delivery of the ongoing
and planned integration and restructuring plans and the planned demerger of Consumer
Healthcare; the delivery of revenues and financial benefits from its current and development
pipeline portfolio of drugs and vaccines (which have been assessed for this purpose on a risk-
adjusted basis, as described further below); regulatory approvals of the pipeline portfolio of drugs
and vaccines that underlie these expectations (which have also been assessed for this purpose
on a risk-adjusted basis, as described further below); no material interruptions to supply of the
Group's products; no material mergers, acquisitions or disposals or other material business
development transactions; no material litigation or investigation costs for the Company (save for
those that are already recognised or for which provisions have been made); no share repurchases
by the Company; and no change in the shareholdings in ViiV Healthcare.
The Relevant Statements also factor in all divestments and product exits announced to date as well as
material costs for investment in new product launches and R&D. Pipeline risk-adjusted sales are based
on the latest internal estimate of the probability of technical and regulatory success for each asset in
development.
Notwithstanding the Relevant Statements, there is still uncertainty as to whether our assumptions,
targets, outlooks expectations and ambitions will be achieved, including based on the other assumptions
outlined above.
The statement that GSK estimates that certain assets in late-stage development have the potential to
deliver peak year sales of more than £20 billion on a non-risk adjusted basis is an aggregation, across
the relevant portfolio of assets, of the maximum sales that GSK considers might be achieved from each
such asset (including from lifecycle innovation) in the year that that asset attains its highest sales level, in
all cases before taking into account any risks that could impair GSK's ability to reach that level of sales for
that asset, including risks relating to technical and regulatory success, trial outcomes, launch dates and
execution, exclusivity periods and the impact of changes in the market and healthcare landscape for that
asset. The aggregation is of the peak year sales of each individual asset within the portfolio and not for
one particular year. Accordingly, the statement of estimated non-risk adjusted potential peak year sales
of the relevant assets in late-stage development does not comprise, is wholly different in nature to, and is
subject to very significantly higher levels of uncertainty than the Relevant Statements. As such, while
GSK does not expect to achieve the aggregate amount of those estimated non-risk adjusted peak year
sales, a risk-adjusted assessment of sales of relevant assets during the relevant periods is (as stated
above) taken into account, where relevant, within the Relevant Statements.
All outlook and ambition statements are given on a constant currency basis and use 2021 forecast
exchange rates as a base, assuming a continuation of Q1 2021 closing rates (£1/$1.38, £1/€1.17, £1/Yen
152). 2021-2026 outlook refers to the 5 years to 2026 with 2021 as the base year.
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