Shares in GlaxoSmithKline (GSK) are down after its profits were hit by a fall in sales and the strong pound.
The drug maker's shares fell more than six per cent by 13:00 BST today (July 23rd), the biggest daily fall since 2008.
The company reported a 23 per cent fall in pre-tax profits to £986 million from £1.29 billion.
It has registered a ten per cent fall in its drug and vaccine sales in the US due to competition from generic drugs.
The company is also involved in a corruption scandal in China, where it has been accused of paying bribes to doctors to use its medicines. Sales in the country were down 20 per cent.
Chief executive Sir Andrew Witty said in a conference call that he had "zero tolerance" of the practices GSK is being accused of.
"I remain very concerned about allegations concerning our China business. The situation is complicated and difficult," he added.
In addition, sales at its consumer healthcare business fell four per cent due to problems with the supply chains.
GSK's 15-year-old respiratory medicine Advair's results were worse than expected, with sales down 19 per cent.
And to make matters worse, the strong pound has also reduced the impact of overseas profits.
The company's HIV business was the only one performing well in the quarter, showing growth of 13 per cent due to strong sales of its new drug Tivicay.
The company now predicts core earnings would be "broadly similar to 2013" in constant exchange rate terms. Previously, it had been hoping to increase these by between four and eight per cent.
Find up to date information on the FTSE 100 and spread betting strategies at City Index.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.