This has just surfaced today,  GlaxoSmithKline plc and Pfizer inc plan to combine their HIV-drug units into a new company that will control almost 20 percent of the market for anti-HIV drugs. The ownership split will be 85/15 in favour of GSK. The final ownership ratios will vary depending upon the outcome of products in development. This is a symptom of the poor outlook for both these companies in this area, with GSK’s Combivir loosing patent protection in 2012, and Pfizer is rumoured to be looking at exiting this entire area. This deal is expected to have a detrimental impact on GSK’s cash flow for the coming financial year so it remains to be seen how the markets will react to it, it looks more like a buy out by GSK than a merger in thsi authors opinion, nothing wrong with that though.

The company will have 11 of agents on the market including  Combivir and Epzicom (with combined sales of approximalty GBP £1.51bn (US$2.25bn), and Pfizer’s Selzentry will be boosted by access to the GSK’s HIV marketing infrastructure. The company will have an estimated 17 product in its development pipeline, four of which are in phase 2 development. it should be in a strong position in the area but this author wonders about risk loading an organisation around a single (high risk) indication.

If you would like more detail in this area please get in touch with Damien Bové damien.bove@idaconsultants.com

Damien Bové works as a drug development consultant (pharmaceutical or biotechnology) and regulatory consultant, we work with our clients to define a drug  evelopment target, define a drug development strategy, define a regulatory strategy or define a commercial strategy. Our clients are generally raising funds or looking to license out their technology and we help them achieve it. If you want to know more don’t hesitate to get in touch.