Drugs giant GlaxoSmithKline said it had lost more than £1 billion due to competition from rival copies of two anti-depressants.

The company has posted a ten per cent fall in third quarter profits to £1.5 billion.

Crawley-based Glaxo said generic versions of Wellbutrin SR and Paxil IR had cost it more than £1.2 billion in lost sales in the first nine months of its financial year. The group said total sales of Wellbutrin products fell 30 per cent to £173 million, which was partially offset by an exceptionally strong performance by Wellbutrin XL, while sales of Paxil dropped 51 per cent to £246 million.

However, chief executive Jean-Pierre Garnier said the quarterly results, which showed total turnover flat at just over £5 billion, confirmed the group's success in absorbing the "significant impact" of the generic competition to the two drugs.

He added that Glaxo's broad portfolio of 14 products was continuing to drive performance, with sales of more than £100 million in the quarter.

He said: "As the impact from Paxil generics now diminishes, we look forward to improved earnings growth in the fourth quarter and in 2005."

Glaxo said the strong performance of key product growth drivers including diabetes drug Avandia and asthma treatment Advair were helping to keep overall sales level.

Seretide/Advair is now the world's fifth largest-selling pharmaceutical product with sales up 20 per cent to £609 million.

Several key product launches expected in the next six months include Vesicare for overactive bladders, Avandaryl for type-two diabetes and Requip for restless leg syndrome.

Mr Garnier said the company was also continuing to make progress with its pipeline of potential new medicines that will fuel the company's future performance.

Development drugs such as Lapatinib for cancer, Allermist for rhinitis and the Cervarix vaccine for cervical cancer were now in phase-three clinical development.

Mr Garnier said: "A wave of other exciting compounds for diseases such as HIV and blood disorders are making good progress."

Glaxo has suffered a slowdown in introducing new drugs to the market at a time when sales of many of its best-selling medicines are coming under pressure from generic copies.

Next month the group is expected to announce details of experimental products to treat pain, depression and other central nervous system disorders.

The development of a successor to anti-depressant Wellbutrin is being delayed at least a year as the company carries out studies to see if it also works against obesity.

Diparcil, a treatment for chronic heart disease, is in advanced clinical trials but is not due to go on sale until 2007.