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Glaxo Letter Affirms Avandia Drug Is Safe; Shares Recover Slightly

GlaxoSmithKline moved on Wednesday to reaffirm the safety of its troubled diabetes drug Avandia in a letter to the Lancet medical journal, reviving the group's battered stock price somewhat.

Shares of the company were recently trading higher.

Its medical director, Ronald Krall, said data from long-term, large-scale trials showed the overall ischemic cardiovascular safety profile, including cardiovascular death, among diabetes patients treated with Avandia was comparable to patients treated with two other widely used diabetes medicines.

His letter included further analyses from the previously released ADOPT and DREAM clinical trials, and findings from a soon-to-be-published study using a managed care database of more than 30,000 diabetes patients in a real-world setting.

Concerns about Avandia were sparked last week by a pooled, or meta, analysis published in New England Journal of Medicine, which concluded Avandia increased the risk of heart attack by 43 percent and cardiac-related death by 64 percent.

That hammered shares in Europe's biggest drugmaker on investors' fears of a major slide in sales of its second largest product, which generated revenues of 1.6 billion pounds ($3.2 billion) in 2006.

Krall, however, said the actual number of heart attacks in this meta-analysis represented a very low frequency of events -- just 0.6 percent for both the Avandia and the control group.

There were 86 out of 14,371 patients in the Avandia arm and 72 out of 11,634 in the control group.

Glaxo said at the time it strongly disagreed with the findings of top U.S. cardiologist Steven Nissen but industry analysts said many doctors were likely to shun Avandia in favor of alternative treatments, pending further clinical evidence.

Merrill Lynch analysts earlier on Wednesday downgraded Glaxo to "sell" from "neutral," predicting no near-term growth for Avandia and a possible decline in sales, sending the shares to a two-year low of 12.69 pounds.

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