GSK and its consumer spin-off brand Haleon have hit back at market speculation over heartburn drug Zantac that sent its shares plummeting on Thursday.
Pharma giant GSK bashed the “meritless claims” which alleged that the use of Zantac, known chemically as ranitidine, increases the risk of cancer in patients.
It said in a statement on Friday: “The overwhelming weight of the scientific evidence supports the conclusion that there is no increased cancer risk associated with the use of ranitidine.
“Suggestions to the contrary are therefore inconsistent with the science, and GSK will vigorously defend itself against all meritless claims alleging otherwise.”
Consumer health group Haleon confirmed it is not party to any of the claims surrounding Zantac, nor is it primarily liable for the product given other companies have sold it over the counter.
The statements come amid growing investor uncertainty around ongoing litigation relating to Zantac.
The drug was owned by GSK but distribution was halted and the drug was recalled in 2019 after regulators raised concerns that the product contained potential cancer-causing impurities.
In June, Haleon highlighted in its prospectus that Zantac is named in outstanding lawsuits, with a trial due to begin on August 22 in the US.
Billions of pounds were lost from the share price values of both Haleon and GSK on Thursday as investors reacted to the emerging reports.
Since Tuesday around £8 billion has been wiped off the price of London-listed GSK.
Litigation analysts from Bloomberg have suggested that a settlement in the lawsuits could cost between five and seven billion dollars (£4.1 – £5.8 billion), with GSK potentially liable for around 30% of the value, so up to around two billion dollars (£1.7 billion), Shore Capital said.
But GSK assured investors that there is no cancer risk of using ranitidine, based on evidence gathered from 11 scientific studies into the drug.
Shares in both companies stabilised following the statement, with GSK’s share price lifting by more than 3% and Haleon edging up by more than 1%.
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