Glaxo's £1.9bn deal boosts pipeline

By Press Association , Jul 17, 2012
Filed under: Investing

GlaxoSmithKline has boosted its pipeline of drugs with a £1.9 billion deal for its American partner on a potential blockbuster medicine.

The proposed acquisition of Human Genome Sciences (HGS) means it has secured the full rights for Benlysta, the first new drug to be approved to treat immune system disease lupus in the US for more than 50 years.

It finally gained boardroom support after HGS directors dismissed a previous offer as inadequate and launched an unsuccessful hunt for an alternative buyer.

Buying the biotechnology company will help GSK further bolster its pipeline of new drugs at a time when the pharmaceutical industry is facing large numbers of patent expiries, leaving products open to being copied by rivals.

GSK offered 14.25 US dollars (£9.15) per share offer - nearly double the price the shares were trading at before the three-month takeover pursuit - valuing HGS at 3 billion US dollars (£1.9 billion). It hopes to find at least 200 million US dollars (£128.4 million) in synergies by 2015.

HGS said Benlysta has shown steady growth in sales since its launch last year but it is thought to have strong opportunities for expansion both in the US, where there are 325,000 lupus patients, and overseas.

Glaxo currently has a profit-sharing agreement with HGS for the drug but the deal will secure all of its revenues. It will also see GSK gain full ownership for type-two diabetes treatment, albiglutide, and darapladib, a possible treatment for atherosclerosis - a hardening of the arteries.

GSK chief executive Sir Andrew Witty said: "We are pleased to have reached a mutually beneficial agreement with HGS on friendly terms and believe the combination of GSK and HGS represents clear financial and strategic logic for both companies and our respective shareholders."

Glaxo has had a near-20 year relationship with HGS, after paying 125 million US dollars (£102 million) in 1993 to establish a research partnership with the company, which has developed a map of all the genes in the human body.

Fears of a so-called patent cliff has been driving consolidation in the pharmaceuticals industry in recent months as giant players look to secure their future pipelines. AstraZeneca last month teamed up with its US partner Bristol-Myers Squibb to buy diabetes drug developer Amylin in a 7 billion dollar (£5.7 billion) deal.

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mickyincornwall

HOW CAN YOU TRUST GSK THEY WERE FINED MILLIONS FOR KNOWINGLY SELLING DRUGS THAT DIDNT WORK. THEN THE GOVERNMENT CAME TO THEIR RESCUE BY GETTING THEM TO MAKE ENOUGH SWINE FLU INJECTIONS TO DO EVERYBODY TWICE IN THE UK.

July 17 2012 at 6:13 AM Report abuse Permalink rate up rate down Reply

banicevich

.... from Benlysta's website
The safety profile of BENLYSTA was evaluated in clinical trials. In addition to the benefits proven in these trials, BENLYSTA also has potential risks.

BENLYSTA can cause serious side effects, including infections, heart problems, and mental health problems, including suicide. Some of these side effects may cause death. It is not known if BENLYSTA causes these serious side effects. Tell your healthcare professional right away if you have any of the symptoms listed below while receiving BENLYSTA.

Infections: Symptoms can include fever, chills, frequent or painful urination, bloody diarrhea, or coughing up mucus. You should not receive BENLYSTA if you have an infection, unless your healthcare professional says it is okay.

Heart problems: Symptoms can include chest discomfort or pain or discomfort in other areas of the upper body, shortness of breath, cold sweats, nausea, or dizziness.

Mental health problems, including suicide: Symptoms can include thoughts of suicide or dying, attempting to commit suicide, thoughts of hurting yourself or others, trouble sleeping, new or worsening anxiety or depression, acting on dangerous impulses, and other unusual changes in your behavior or mood.

Serious allergic and infusion reactions can happen on the day of or the day after receiving BENLYSTA and may cause death. Tell your healthcare professional right away if you have any of the following symptoms of a reaction: itching; swelling of the face, lips, mouth, tongue, or throat; trouble breathing; anxiousness; low blood pressure; dizziness or fainting; headache; nausea; or skin rash, redness, or swelling. Tell your healthcare professional or get emergency medical help right away if you have any of these symptoms.

BENLYSTA may reduce the activity of your immune system. Medicines that affect the immune system may increase your risk of certain cancers.

The most common BENLYSTA side effects
The most common side effects of BENLYSTA include nausea, diarrhea, fever, stuffy or runny nose, cough (bronchitis), trouble sleeping, pain in legs or arms, depression, headache (migraine), sore throat, urinary tract infection, decreased white blood cell count (leukopenia), vomiting, and stomach pain.

These are not all the possible side effects of BENLYSTA, so check with your healthcare professional for more information. Tell him or her if you have any side effect that bothers you or doesn't go away.