Glaxo's Profit Falls

Earnings for the first quarter drop off due to generic-drug competition and other hits.
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GlaxoSmithKline

(GSK) - Get Report

, weighed down by generic-drug competition and steep fall-off in sales of its diabetes drug Avandia, Wednesday reported a 10% decline in first-quarter profit.

Shares of the British drug company -- recently busied with a Food and Drug Administration approval, an R&D deal and an acquisition -- were up 78 cents, or 1.8%, to $44.51 in recent trading.

Glaxo said first-quarter profit fell 10% from the year-ago quarter to 25.6 pence (51 cents) a share. Revenue increased 1.7% to 5.69 billion pounds ($11.32 billion).

Analysts surveyed by Thomson Financial were looking for 49 cents a share, on total revenue of $11.03 billion.

The company saw 6% growth to $2.25 billion in international sales, but sales fell 10% to $4.26 billion in the U.S. where generic pressures took a toll.

Sales of asthma drug Advair increased 10% to $1.898 billion. Also helping out, vaccine sales increased 10% to $867.8 million, including a 34% increase to $216.9 million in the U.S. driven by hepatitis vaccines.

Also, consumer health-care sales, which include over-the-counter medicine, oral health care and nutritional health care, were up 8% to roughly $1.78 billion.

However, Glaxo's revenue was hurt by a 5% decline in total HIV sales to $712.5 million and a 77% decline in sales of heart disease drug Coreg to $95.5 million. The company also suffered a 56% decline in sales of type II diabetes drug Avandia to roughly $380 million -- the company received an FDA warning in the quarter for failing to include certain data on the drug in its regular reports to the agency.

Since the end of the first quarter, developments for the world's second largest drugmaker include the

FDA approval

of migraine treatment Treximet, for which Glaxo partners with

Pozen Pharmaceuticals

(POZN)

, earlier this month.

Also, on April 17, Glaxo announced

a tie-up

with Regulus Therapeutics (an

Alnylam

(ALNY) - Get Report

and

Isis

(ISIS)

venture) for microRNA-targeted therapeutics. And, Tuesday post-close, Glaxo said it would acquire

Sirtris Pharmaceuticals

(SIRT)

for $720 million

.

Looking ahead, Glaxo expects earnings per share to decline by a mid-single digit percentage at constant exchange rates.

Analysts surveyed by Thomson Financial are expecting profit of $1.91 a share on revenue of roughly $45.6 billion for the year.