Drug manufacturing giants Pfizer and GlaxoSmithKline will combine their consumer healthcare units in a separate joint venture that will be the world’s largest seller of over-the-counter medicines.
The combined sales of the new entity are approximately $12.7 billion. Glaxo, based in London, will have a majority interest of 68 percent while Pfizer will retain a 32 percent stake in the joint venture. The combined company will also have the largest global market share in over-the-counter medicines at 7.3 percent, with the nearest competitor at a 4.1 percent share.
Within three years of creating the joint venture, Glaxo plans to spin off the entity. The transaction concludes a yearlong search by Pfizer to sell off its consumer business, The Wall Street Journal reported.
The deal is an all-equity transaction, with Glaxo capitalizing on the recent buyout of Novartis’ stake in Glaxo’s consumer health business, according to a press release.
“With our future intention to separate, the transaction also presents a clear pathway forward for GSK to create a new global pharmaceuticals/vaccines company, with an R&D approach focused on science related to the immune system, use of genetics and advanced technologies, and a new world-leading Consumer Healthcare company,” Emma Walmsley, CEO of GSK, said in a statement. “Ultimately, our goal is to create two exceptional, UK-based global companies, with appropriate capital structures, that are each well positioned to deliver improving returns to shareholders and significant benefits to patients and consumers.”
Amy joined TriMed Media as a Senior Writer for HealthExec after covering home care for three years. When not writing about all things healthcare, she fulfills her lifelong dream of becoming a pirate by sailing in regattas and enjoying rum. Fun fact: she sailed 333 miles across Lake Michigan in the Chicago Yacht Club "Race to Mackinac."