GlaxoSmithKline will write down £1.5bn ($3.1bn) for restructuring costs over the next four years as it braces itself for intensifying generic drug competition and further disappointing sales from its pivotal diabetes treatment, Avandia.

The world’s second largest pharmaceuticals company, which reported third-quarter profits 7 per cent lower at £1.9bn, will take a first significant charge this year. This will depress earnings per share growth below the 2007 guidance it gave in February of 8-10 per cent at constant exchange rates.