The pharma giant published its annual report last Friday, revealing that it has dropped 11 phase II compounds.
The potential loss in future revenue is "only partially offset by the emergence of seven commercially significant novel Phase II compounds," according to Dr Andrew Baum, an analyst at Morgan Stanley.
Over recent years, R&D costs have rocketed - it now costs a pharma company over $800m (€611m) per approved drug.
Coupled with several challenges facing the industry, for example increased generic competition, several pharma giants have recently reassessed their pipelines and business models.
"Our pre-existing concerns over the strength of GSK's much hyped pipeline have grown following publication of the companies revised pipeline," said Dr Baum.
He estimates that dropping the drugs will cost GSK around $2.3bn in lost revenue in 2013.
New compounds into Phase II will be worth around $975m, leaving GSK with a potential short fall of $1.3bn.
He continued: "We continue to wonder whether GSK's self imposed near term R&D cap is slowing pipeline progression."
The biggest single loss to revenue comes from dropping odiparcil, an indirect thrombin inhibitor that was developed to prevent blood clots related to cardiovascular disease.
Morgan Stanley estimated the compound could have been worth $338m in 2013.
A further $225m reduction in potential sales could result from the decision to cease development of the Type II diabetes drug, solabegron.
The drug is aimed at activating a protein called beta-3 adrenergic receptor in order to enhance lipolysis - the process by which the body breaks down stored fat and releases glycerol.
However, the drug will continue to be developed as a possible treatment for overactive bladder and irritable bladder syndrome.
Other drugs dropped from GSK's pipeline were combination therapy, vesipitant and paroxetine for depression and anxiety and four anti-cancer drugs.
"While product failure is inevitable, the contraction of GSK's oncology pipeline is a potential concern given the significant in-licensing investment in this area," said Dr Baum.
The four oncology drugs were: ethynylcytidine, a selective RNA polymerase inhibitor to treat solid tumours; iboctadekin, a recombinant form of human interleukin 18 designed to induce an immune system response against certain susceptible cancers, such as melanoma; ispinesib, a KSP protein inhibitor to treat lung cancer amoung others; vestipitant, an NK1 inhibitor to treat postoperative nausea and vomiting, which was also being tested in combination with Paxil/Seroxat (paroxetine) for depression and anxiety.
"Given the size of GSK's pipeline, we are disappointed to see that only 7 out of 42 commercially significant compounds seem to have advanced into Phase II, compared to last years update," said Dr Baum.
Of the seven, he identifed the key compounds as: 681313 and 856553, which are both p38 kinase inhibitors to treat chronic obstructive pulmonary diesease (COPD) -although the first is also be tested for rheumatoid arthritis, atherosclerosis and pain; albiglutide, which is a glucagon-like peptide activator for the treatment of Type II diabetes; 364735, an HIV integrase inhibitor; and 649868, an orexin inhibtor for insomnia.