Europe's biggest drug maker, GlaxoSmithKline, has reported earnings at the bottom end of expectations for the July to September period.

Earnings per share rose increased to 16.7 pence in the quarter, against forecasts of 16.5-18.7p.

The company said it stuck by its forecasts of at least 10% earnings growth this year, and also announced a �4bn extension to its share buy-back programme.

But investors were unimpressed, and Glaxo's shares closed down 84 pence, or 6.3%, at 1247p.

'Good performance'

Glaxo has come under pressure this year on fears that cheap generic or 'copycat' versions of some of its best-selling drugs will hit sales and profits.

"Despite facing generic competition to Augmentin, GSK had a good financial performance this quarter," chief executive JP Garnier said.

In May this year, a US court said Glaxo's patents for Augmentin - an antibiotic - were no longer valid.

As a result, sales of the drug dropped 40% in the July to September quarter as it lost out to cheaper rivals.

"We suffered the full impact of generic versions and I expect this frankly to continue and get worse as we go forward," Mr Garnier added.

But he said Wednesday's figures "clearly" showed the "strength" of GSK.

Currency blow

Glaxo posted pre-tax profit of �1.388bn for the three month period, a 3% rise on the same period and a 12% rise on a constant exchange rate basis.

Glaxo said sterling profits had been "significantly" hit by currency movements, including the weakness of the US dollar.

Sales rose 1% to �5.02bn, or 6% on a constant currency basis.

Pharmaceutical sales rose 6% to �4.2bn, with US sales up 9% to �2.3bn.

The new respiratory drug Seretide/Advair continued to do well with sales rising 70% to �392m.