Glaxo to Shift Away From Antidepressant Research - Wall St J

[Guest guest]

WHALEN GlaxoKline PLC said it will stop research into new antidepressants and focus on diseases for which it believes it can develop more valuable drugs, a major shift for a company that developed some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in fourth-quarter earnings Thursday, were long fueled by the antidepressants Paxil and Wellbutrin, which at their peak generated billions of dollars a year in sales. Similar medicines, such as Eli Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big sales for those companies.

View Full ImageMark Lennihan/Associated Press Witty, CEO of GlaxoKline, spoke at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand antidepressants, which accounted for just 2.3% of Glaxo's total sales last year, down from 14% in 2002. Chief Executive Witty said Thursday that the company thinks further investment in the market wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of antidepressants are among the "most expensive and highest-risk" of all drug trials, Mr. Witty said, because companies often don't know until the end of very large studies whether a drug works. It is also hard to prove that a depression drug is working, he said, because patient improvement is measured by subjective mood surveys, and not by the clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest their resources," he said, adding that Glaxo would scrap research into pain drugs for the same reasons, focusing instead on diseases including Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca PLC, continue to invest in antidepressant research. In December, AstraZeneca paid a biotech company $200 million for the rights to develop an experimental antidepressant. But companies generally are more eager to invest in cancer and diseases tied to aging, where the need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly profit rose to £1.63 billion ($2.59 billion) fom £982 million a year earlier, helped by a £296 million gain from placing its HIV activities into a joint venture with Pfizer. The results also were flattered by big restructuring charges that cut net profit in the fourth quarter of 2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1 vaccine and other pandemic-flu products. Full-year sales of H1N1 vaccine were £883 million, mostly coming in the fourth quarter, and Glaxo said it expects the same level of H1N1 vaccine sales this year. Some countries, such as Germany and France, have cut their orders for the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to £720 million from £57 million in 2008 as countries stockpiled the drug to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the fourth quarter. Mr. Witty would say only that these related to "quite a number of cases," declining to add whether they were tied to a federal investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research funds in experimental drugs discovered by outside academic groups and biotech companies, which he said would improve the company's return on investment. Overall it aims to boost its return on investment in late-stage drug development to 14% from a current 11%. —Sten Stovall and contributed to this article. Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

WHALEN GlaxoKline PLC said it will stop research into new antidepressants and focus on diseases for which it believes it can develop more valuable drugs, a major shift for a company that developed some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in fourth-quarter earnings Thursday, were long fueled by the antidepressants Paxil and Wellbutrin, which at their peak generated billions of dollars a year in sales. Similar medicines, such as Eli Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big sales for those companies.

View Full ImageMark Lennihan/Associated Press Witty, CEO of GlaxoKline, spoke at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand antidepressants, which accounted for just 2.3% of Glaxo's total sales last year, down from 14% in 2002. Chief Executive Witty said Thursday that the company thinks further investment in the market wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of antidepressants are among the "most expensive and highest-risk" of all drug trials, Mr. Witty said, because companies often don't know until the end of very large studies whether a drug works. It is also hard to prove that a depression drug is working, he said, because patient improvement is measured by subjective mood surveys, and not by the clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest their resources," he said, adding that Glaxo would scrap research into pain drugs for the same reasons, focusing instead on diseases including Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca PLC, continue to invest in antidepressant research. In December, AstraZeneca paid a biotech company $200 million for the rights to develop an experimental antidepressant. But companies generally are more eager to invest in cancer and diseases tied to aging, where the need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly profit rose to £1.63 billion ($2.59 billion) fom £982 million a year earlier, helped by a £296 million gain from placing its HIV activities into a joint venture with Pfizer. The results also were flattered by big restructuring charges that cut net profit in the fourth quarter of 2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1 vaccine and other pandemic-flu products. Full-year sales of H1N1 vaccine were £883 million, mostly coming in the fourth quarter, and Glaxo said it expects the same level of H1N1 vaccine sales this year. Some countries, such as Germany and France, have cut their orders for the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to £720 million from £57 million in 2008 as countries stockpiled the drug to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the fourth quarter. Mr. Witty would say only that these related to "quite a number of cases," declining to add whether they were tied to a federal investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research funds in experimental drugs discovered by outside academic groups and biotech companies, which he said would improve the company's return on investment. Overall it aims to boost its return on investment in late-stage drug development to 14% from a current 11%. —Sten Stovall and contributed to this article. Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

WHALEN GlaxoKline PLC said it will stop research into new antidepressants and focus on diseases for which it believes it can develop more valuable drugs, a major shift for a company that developed some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in fourth-quarter earnings Thursday, were long fueled by the antidepressants Paxil and Wellbutrin, which at their peak generated billions of dollars a year in sales. Similar medicines, such as Eli Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big sales for those companies.

View Full ImageMark Lennihan/Associated Press Witty, CEO of GlaxoKline, spoke at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand antidepressants, which accounted for just 2.3% of Glaxo's total sales last year, down from 14% in 2002. Chief Executive Witty said Thursday that the company thinks further investment in the market wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of antidepressants are among the "most expensive and highest-risk" of all drug trials, Mr. Witty said, because companies often don't know until the end of very large studies whether a drug works. It is also hard to prove that a depression drug is working, he said, because patient improvement is measured by subjective mood surveys, and not by the clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest their resources," he said, adding that Glaxo would scrap research into pain drugs for the same reasons, focusing instead on diseases including Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca PLC, continue to invest in antidepressant research. In December, AstraZeneca paid a biotech company $200 million for the rights to develop an experimental antidepressant. But companies generally are more eager to invest in cancer and diseases tied to aging, where the need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly profit rose to £1.63 billion ($2.59 billion) fom £982 million a year earlier, helped by a £296 million gain from placing its HIV activities into a joint venture with Pfizer. The results also were flattered by big restructuring charges that cut net profit in the fourth quarter of 2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1 vaccine and other pandemic-flu products. Full-year sales of H1N1 vaccine were £883 million, mostly coming in the fourth quarter, and Glaxo said it expects the same level of H1N1 vaccine sales this year. Some countries, such as Germany and France, have cut their orders for the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to £720 million from £57 million in 2008 as countries stockpiled the drug to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the fourth quarter. Mr. Witty would say only that these related to "quite a number of cases," declining to add whether they were tied to a federal investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research funds in experimental drugs discovered by outside academic groups and biotech companies, which he said would improve the company's return on investment. Overall it aims to boost its return on investment in late-stage drug development to 14% from a current 11%. —Sten Stovall and contributed to this article. Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

WHALEN GlaxoKline PLC said it will stop research into new antidepressants and focus on diseases for which it believes it can develop more valuable drugs, a major shift for a company that developed some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in fourth-quarter earnings Thursday, were long fueled by the antidepressants Paxil and Wellbutrin, which at their peak generated billions of dollars a year in sales. Similar medicines, such as Eli Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big sales for those companies.

View Full ImageMark Lennihan/Associated Press Witty, CEO of GlaxoKline, spoke at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand antidepressants, which accounted for just 2.3% of Glaxo's total sales last year, down from 14% in 2002. Chief Executive Witty said Thursday that the company thinks further investment in the market wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of antidepressants are among the "most expensive and highest-risk" of all drug trials, Mr. Witty said, because companies often don't know until the end of very large studies whether a drug works. It is also hard to prove that a depression drug is working, he said, because patient improvement is measured by subjective mood surveys, and not by the clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest their resources," he said, adding that Glaxo would scrap research into pain drugs for the same reasons, focusing instead on diseases including Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca PLC, continue to invest in antidepressant research. In December, AstraZeneca paid a biotech company $200 million for the rights to develop an experimental antidepressant. But companies generally are more eager to invest in cancer and diseases tied to aging, where the need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly profit rose to £1.63 billion ($2.59 billion) fom £982 million a year earlier, helped by a £296 million gain from placing its HIV activities into a joint venture with Pfizer. The results also were flattered by big restructuring charges that cut net profit in the fourth quarter of 2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1 vaccine and other pandemic-flu products. Full-year sales of H1N1 vaccine were £883 million, mostly coming in the fourth quarter, and Glaxo said it expects the same level of H1N1 vaccine sales this year. Some countries, such as Germany and France, have cut their orders for the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to £720 million from £57 million in 2008 as countries stockpiled the drug to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the fourth quarter. Mr. Witty would say only that these related to "quite a number of cases," declining to add whether they were tied to a federal investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research funds in experimental drugs discovered by outside academic groups and biotech companies, which he said would improve the company's return on investment. Overall it aims to boost its return on investment in late-stage drug development to 14% from a current 11%. —Sten Stovall and contributed to this article. Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

If they stop making and promoting them then that is a

change for the positive.

On 2/5/2010 5:43 PM, jeremy9282 wrote:

WHALEN

GlaxoKline PLC said it will stop research into new

antidepressants and focus on diseases for which it believes it can

develop more valuable drugs, a major shift for a company that developed

some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in

fourth-quarter earnings Thursday, were long fueled by the

antidepressants Paxil and Wellbutrin, which at their peak generated

billions of dollars a year in sales. Similar medicines, such as Eli

Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big

sales for those companies.

View Full Image

Mark Lennihan/Associated Press

Witty, CEO of GlaxoKline, spoke

at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand

antidepressants, which accounted for just 2.3% of Glaxo's total sales

last year, down from 14% in 2002. Chief Executive Witty said

Thursday that the company thinks further investment in the market

wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of

antidepressants are among the "most expensive and highest-risk" of all

drug trials, Mr. Witty said, because companies often don't know until

the end of very large studies whether a drug works. It is also hard to

prove that a depression drug is working, he said, because patient

improvement is measured by subjective mood surveys, and not by the

clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care

payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest

their resources," he said, adding that Glaxo would scrap research into

pain drugs for the same reasons, focusing instead on diseases including

Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare

diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca

PLC, continue to invest in antidepressant research. In December,

AstraZeneca paid a biotech company $200 million for the rights to

develop an experimental antidepressant. But companies generally are

more eager to invest in cancer and diseases tied to aging, where the

need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly

profit rose to £1.63 billion ($2.59 billion) fom £982 million a year

earlier, helped by a £296 million gain from placing its HIV activities

into a joint venture with Pfizer. The results also were flattered by

big restructuring charges that cut net profit in the fourth quarter of

2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1

vaccine and other pandemic-flu products. Full-year sales of H1N1

vaccine were £883 million, mostly coming in the fourth quarter, and

Glaxo said it expects the same level of H1N1 vaccine sales this year.

Some countries, such as Germany and France, have cut their orders for

the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to

£720 million from £57 million in 2008 as countries stockpiled the drug

to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the

fourth quarter. Mr. Witty would say only that these related to "quite a

number of cases," declining to add whether they were tied to a federal

investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research

funds in experimental drugs discovered by outside academic groups and

biotech companies, which he said would improve the company's return on

investment. Overall it aims to boost its return on investment in

late-stage drug development to 14% from a current 11%.

—Sten Stovall and contributed to

this article.

Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

If they stop making and promoting them then that is a

change for the positive.

On 2/5/2010 5:43 PM, jeremy9282 wrote:

WHALEN

GlaxoKline PLC said it will stop research into new

antidepressants and focus on diseases for which it believes it can

develop more valuable drugs, a major shift for a company that developed

some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in

fourth-quarter earnings Thursday, were long fueled by the

antidepressants Paxil and Wellbutrin, which at their peak generated

billions of dollars a year in sales. Similar medicines, such as Eli

Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big

sales for those companies.

View Full Image

Mark Lennihan/Associated Press

Witty, CEO of GlaxoKline, spoke

at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand

antidepressants, which accounted for just 2.3% of Glaxo's total sales

last year, down from 14% in 2002. Chief Executive Witty said

Thursday that the company thinks further investment in the market

wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of

antidepressants are among the "most expensive and highest-risk" of all

drug trials, Mr. Witty said, because companies often don't know until

the end of very large studies whether a drug works. It is also hard to

prove that a depression drug is working, he said, because patient

improvement is measured by subjective mood surveys, and not by the

clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care

payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest

their resources," he said, adding that Glaxo would scrap research into

pain drugs for the same reasons, focusing instead on diseases including

Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare

diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca

PLC, continue to invest in antidepressant research. In December,

AstraZeneca paid a biotech company $200 million for the rights to

develop an experimental antidepressant. But companies generally are

more eager to invest in cancer and diseases tied to aging, where the

need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly

profit rose to £1.63 billion ($2.59 billion) fom £982 million a year

earlier, helped by a £296 million gain from placing its HIV activities

into a joint venture with Pfizer. The results also were flattered by

big restructuring charges that cut net profit in the fourth quarter of

2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1

vaccine and other pandemic-flu products. Full-year sales of H1N1

vaccine were £883 million, mostly coming in the fourth quarter, and

Glaxo said it expects the same level of H1N1 vaccine sales this year.

Some countries, such as Germany and France, have cut their orders for

the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to

£720 million from £57 million in 2008 as countries stockpiled the drug

to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the

fourth quarter. Mr. Witty would say only that these related to "quite a

number of cases," declining to add whether they were tied to a federal

investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research

funds in experimental drugs discovered by outside academic groups and

biotech companies, which he said would improve the company's return on

investment. Overall it aims to boost its return on investment in

late-stage drug development to 14% from a current 11%.

—Sten Stovall and contributed to

this article.

Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

If they stop making and promoting them then that is a

change for the positive.

On 2/5/2010 5:43 PM, jeremy9282 wrote:

WHALEN

GlaxoKline PLC said it will stop research into new

antidepressants and focus on diseases for which it believes it can

develop more valuable drugs, a major shift for a company that developed

some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in

fourth-quarter earnings Thursday, were long fueled by the

antidepressants Paxil and Wellbutrin, which at their peak generated

billions of dollars a year in sales. Similar medicines, such as Eli

Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big

sales for those companies.

View Full Image

Mark Lennihan/Associated Press

Witty, CEO of GlaxoKline, spoke

at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand

antidepressants, which accounted for just 2.3% of Glaxo's total sales

last year, down from 14% in 2002. Chief Executive Witty said

Thursday that the company thinks further investment in the market

wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of

antidepressants are among the "most expensive and highest-risk" of all

drug trials, Mr. Witty said, because companies often don't know until

the end of very large studies whether a drug works. It is also hard to

prove that a depression drug is working, he said, because patient

improvement is measured by subjective mood surveys, and not by the

clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care

payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest

their resources," he said, adding that Glaxo would scrap research into

pain drugs for the same reasons, focusing instead on diseases including

Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare

diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca

PLC, continue to invest in antidepressant research. In December,

AstraZeneca paid a biotech company $200 million for the rights to

develop an experimental antidepressant. But companies generally are

more eager to invest in cancer and diseases tied to aging, where the

need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly

profit rose to £1.63 billion ($2.59 billion) fom £982 million a year

earlier, helped by a £296 million gain from placing its HIV activities

into a joint venture with Pfizer. The results also were flattered by

big restructuring charges that cut net profit in the fourth quarter of

2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1

vaccine and other pandemic-flu products. Full-year sales of H1N1

vaccine were £883 million, mostly coming in the fourth quarter, and

Glaxo said it expects the same level of H1N1 vaccine sales this year.

Some countries, such as Germany and France, have cut their orders for

the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to

£720 million from £57 million in 2008 as countries stockpiled the drug

to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the

fourth quarter. Mr. Witty would say only that these related to "quite a

number of cases," declining to add whether they were tied to a federal

investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research

funds in experimental drugs discovered by outside academic groups and

biotech companies, which he said would improve the company's return on

investment. Overall it aims to boost its return on investment in

late-stage drug development to 14% from a current 11%.

—Sten Stovall and contributed to

this article.

Write to Jeanne Whalen at jeanne.whalen@...

[Guest guest]

If they stop making and promoting them then that is a

change for the positive.

On 2/5/2010 5:43 PM, jeremy9282 wrote:

WHALEN

GlaxoKline PLC said it will stop research into new

antidepressants and focus on diseases for which it believes it can

develop more valuable drugs, a major shift for a company that developed

some of the biggest-selling antidepressants of the past 20 years.

Profits at the U.K. drug giant, which posted a 66% increase in

fourth-quarter earnings Thursday, were long fueled by the

antidepressants Paxil and Wellbutrin, which at their peak generated

billions of dollars a year in sales. Similar medicines, such as Eli

Lilly & Co.'s Prozac and Pfizer Inc.'s Zoloft, also generated big

sales for those companies.

View Full Image

Mark Lennihan/Associated Press

Witty, CEO of GlaxoKline, spoke

at the Council on Foreign Relations in New York in January.

However, low-cost generic copies have eroded demand for name-brand

antidepressants, which accounted for just 2.3% of Glaxo's total sales

last year, down from 14% in 2002. Chief Executive Witty said

Thursday that the company thinks further investment in the market

wouldn't be prudent.

Part of the reason is financial risk. Clinical trials of

antidepressants are among the "most expensive and highest-risk" of all

drug trials, Mr. Witty said, because companies often don't know until

the end of very large studies whether a drug works. It is also hard to

prove that a depression drug is working, he said, because patient

improvement is measured by subjective mood surveys, and not by the

clear-cut blood tests and biological measures used in other diseases.

That's a drawback in an era when insurers and other health-care

payers want to see clear value for their money, Mr. Witty said.

Payers "want big benefits to make it worth their while to invest

their resources," he said, adding that Glaxo would scrap research into

pain drugs for the same reasons, focusing instead on diseases including

Alzheimer's, Parkinson's, multiple sclerosis and a clutch of rare

diseases.

Other companies, such as Lilly, Sanofi-Aventis SA and AstraZeneca

PLC, continue to invest in antidepressant research. In December,

AstraZeneca paid a biotech company $200 million for the rights to

develop an experimental antidepressant. But companies generally are

more eager to invest in cancer and diseases tied to aging, where the

need for new treatments is greater.

Mr. Witty announced the changes as Glaxo reported that quarterly

profit rose to £1.63 billion ($2.59 billion) fom £982 million a year

earlier, helped by a £296 million gain from placing its HIV activities

into a joint venture with Pfizer. The results also were flattered by

big restructuring charges that cut net profit in the fourth quarter of

2008. The charges stemmed from a cost-cutting program and acquisitions.

Sales grew 17% to £8.1 billion from £6.9 billion, aided by H1N1

vaccine and other pandemic-flu products. Full-year sales of H1N1

vaccine were £883 million, mostly coming in the fourth quarter, and

Glaxo said it expects the same level of H1N1 vaccine sales this year.

Some countries, such as Germany and France, have cut their orders for

the vaccine, partly because the pandemic hasn't been as bad as feared.

Sales of the antiviral drug Relenza for the full year soared to

£720 million from £57 million in 2008 as countries stockpiled the drug

to treat people infected with the H1N1 virus.

Weighing on earnings were £392 million of legal charges in the

fourth quarter. Mr. Witty would say only that these related to "quite a

number of cases," declining to add whether they were tied to a federal

investigation of the company's drug-marketing practices in the U.S.

Mr. Witty said Glaxo aims to invest even more of its research

funds in experimental drugs discovered by outside academic groups and

biotech companies, which he said would improve the company's return on

investment. Overall it aims to boost its return on investment in

late-stage drug development to 14% from a current 11%.

—Sten Stovall and contributed to

this article.

Write to Jeanne Whalen at jeanne.whalen@...