DRUGS group GlaxoSmithKline said it had lost £1.5bn in sales to copies of its flagship drugs, but still managed to grow the business last year.

Glaxo, which employs 1,100 people at its factory in Barnard Castle, County Durham, said sales of medicines over the 12 months to December 31 were one per cent higher than a year ago, despite sharp falls in demand for anti-depressants Paxil and Wellbutrin.

Pre-tax profits were two per cent higher, at £6.12bn, using constant exchange rates, but nine per cent lower after the impact of weakness in the US dollar was taken into account.

Chief executive Jean-Pierre Garnier said the company had come through a difficult year and progress in developing new products meant the company was looking forward to a good performance in 2005.

Glaxo disclosed that sales of Paxil fell 39 per cent to £1.1bn and revenues from Wellbutrin dropped 12 per cent to £751m as a result of cheaper versions of the drugs appearing on the market.

But these were offset by a 19 per cent rise in sales of its top-selling Seretide/Advair asthma treatment, to £2.5bn, making it the sixth-largest pharmaceutical product in the world.

New clinical data due to be published next month is expected by the company to give Seretide new momentum, showing that it gives patients more days without symptoms than rival drugs.

In total, Glaxo said 12 of its products generated sales of more than £500m each last year.

New drugs are earmarked for launch during 2005 as Glaxo acts to recoup lost sales from its flagship anti-depressants - led by overactive bladder treatment Vesicare, which went on sale in the US last month.

Its Rotarix vaccine against gastroenteritis has been launched in Mexico and is being considered by the EU for approval, while decisions on the approval of four other drugs are expected from regulators in the US during 2005.

Significant new data was anticipated by the company on a number of drugs in final trials and the potential benefits of at least 15 compounds will become clearer for the treatment of conditions such as HIV, diabetes and multiple sclerosis.

Glaxo - the UK's largest drugmaker - said turnover rose one per cent to £20.36bn at constant exchange rates. Excluding sales of Wellbutrin and Paxil, turnover grew ten per cent in the US and seven per cent globally.

Mr Garnier said: "These results confirm the success which Glaxo has navigated in a difficult year."