GSK Expands Vaccine Collaboration With Zhifei in China

GSK plc GSK announced that it has revised its collaboration deal with Chongqing Zhifei Biological Products (Zhifei), China's largest vaccine maker, to co-market its shingles vaccine Shingrix in mainland China.The revised terms extend this deal by an additional eight years to 2034, including revision in expected volumes. GSK expects Zhifei to purchase volumes of Shingrix valued at £2.3 billion (at current exchange rates) over the 2024-2029 period. Management also stated that the contracted minimum purchase levels specified in the initial agreement are no longer applicable.GSK had initially entered into a collaboration deal, valued at £2.5 billion for three years until 2026, with Zhifei last year to market Shingrix in mainland China. Shingrix is currently approved in China for use in older adults aged 50 years and above.Potential Collaboration for GSK’s RSV VaccineThe amended deal also includes exclusive rights for China's largest vaccine company to explore collaboration on GSK's RSV vaccine Arexvy in China for an initial term of 10 years.This collaboration is subject to regulatory approval of the vaccine in the country. Arexvy is yet to be approved in China.GSK Stock PerformanceYear to date, GSK’s shares have lost 7.1% compared with the industry’s 8.2% decline.Image Source: Zacks Investment ResearchGSK’s Intention Behind the DealThe intent behind GSK's expansion of its partnership with Zhifei seems clear. It intends to revive the demand for its vaccine business, which has been declining since the beginning of this year.GSK’s Vaccine sales declined 13% in the United States in the first nine months of 2024 due to declining sales of Shingrix and Arexvy. While Shingrix’s U.S. sales fell 20% during this timeframe due to lower demand led by challenges activating harder-to-reach consumers. Arexvy sales were negatively impacted by the U.S. CDC’s revised recommendations, which trimmed down the target market.On the third-quarter conference call, GSK significantly lowered its Vaccine sales growth expectations. It now expects vaccine sales to decline in a low-single-digit percentage from 2023 levels at CER versus prior expectations of growth in a low to mid-single-digit percentage. In 2025, GSK expects limited growth in both Shingrix and Arexvy.Per management, there is a lucrative opportunity for Shingrix in China. GSK estimates that by 2030, around 570 million of the country’s population will be over the age of 50. As of June 2023, only around 1.2% of China’s urban population in the 50-74 age group was immunized against shingles.GSK also estimates that nearly 297 million of the country’s population is aged above 60, out of which more than 75% suffer from at least one chronic disease, one of which is RSV.GSK’s Zacks RankGSK currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.GSK PLC Sponsored ADR Price GSK PLC Sponsored ADR price | GSK PLC Sponsored ADR QuoteKey Picks Among Biotech StocksA couple of better-ranked stocks from the sector are Castle Biosciences CSTL and Spero Therapeutics SPRO, both sporting a Zacks Rank #1 at present.In the past 60 days, estimates for Castle Biosciences’ 2024 loss per share have narrowed from 58 cents to 8 cents. During the same timeframe, loss per share estimates for 2025 have narrowed from $2.13 to $1.88. Year to date, shares of Castle Biosciences have surged 47.7%.CSTL’s earnings beat estimates in each of the trailing four quarters, delivering an average surprise of 172.72%.In the past 60 days, estimates for Spero Therapeutics’ 2024 loss per share have narrowed from $1.59 to $1.29. Estimates for 2025 loss per share have narrowed from $1.54 to 79 cents. Year to date, the company’s shares have lost 19.7%.Spero Therapeutics’ earnings beat estimates in two of the trailing four quarters and missed the mark in the other two, delivering an average surprise of 94.42%.5 Stocks Set to DoubleEach was handpicked by a Zacks expert as the #1 favorite stock to gain +100% or more in 2024. While not all picks can be winners, previous recommendations have soared +143.0%, +175.9%, +498.3% and +673.0%.Most of the stocks in this report are flying under Wall Street radar, which provides a great opportunity to get in on the ground floor.Today, See These 5 Potential Home Runs >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report GSK PLC Sponsored ADR (GSK): Free Stock Analysis Report Spero Therapeutics, Inc. (SPRO): Free Stock Analysis Report Castle Biosciences, Inc. (CSTL): Free Stock Analysis ReportTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks