GSK to buy HIV drugs from Bristol-Myers Squibb for initial $350 million

23 Dec 2015 | Author: | No comments yet »

BMS sheds its HIV R&D to ViiV.

LONDON (Reuters) – Pharmaceutical group GlaxoSmithKline said its majority-owned HIV business would buy drugs at different stages of development from U.S. rival Bristol-Myers Squibb for an initial $350 million (£234.9 million).Glaxo said it would pay Bristol $317 million upfront for the company’s late-stage HIV drugs, plus $518 million depending on the drugs hitting particular development and commercial milestones.GlaxoSmithKline Plc agreed to buy Bristol-Myers Squibb Co.’s portfolio of experimental HIV treatments for as much as $1.46 billion in two transactions, bolstering one of the U.K. drugmaker’s fastest-growing businesses.

Bristol-Myers Squibb has set up two individual agreements with ViiV Healthcare to divest its pipeline of investigational HIV drugs at various clinical development stages, under its strategy of winding down virology discovery efforts. GSK said the acquisitions would provide ViiV Healthcare, its HIV unit in which Pfizer and Shionogi are junior partners, with new opportunities for growth.

Glaxo’s ViiV Healthcare unit will pay $317 million in cash upfront for two drugs in late-stage development and $33 million for assets that are in the preclinical or discovery phases of research, the London-based company said in a statement today. ViiV will pay BMS upfront payments totally $350 million with potential development and regulatory milestone payments of up to $518 million for the clinical assets, and up to $587 million for the discovery and preclinical programs. It used to dominate the market but ViiV’s 2014 sales of 1.5 billion pounds ($2.3 billion) were less than a quarter of the HIV revenue generated by market leader Gilead Sciences . The U.K.’s largest drugmaker may also give $518 million plus royalties if the late-stage medicines reach certain milestones, and $587 million in additional payments for the early-stage drugs if they meet targets. ViiV will manage and resource the acquired development programmed and BMS will continue to provide certain R&D support during a transitional period, at a cost.

That status is given to drugs that treat life-threatening or extremely serious conditions for which there is currently no treatment, and accelerates the development and review process. The transaction, which does not include any of BMS’ marketed HIV drugs, is expected to complete during the first half of next year, subject to customary closing conditions. David Redfern, chief strategy officer at GSK and chairman of ViiV Healthcare, said the deals will strengthen the company’s “leadership” in the area of HIV treatments. The late-stage assets acquired by Glaxo included fostemsavir, a medicine for difficult-to-treat patients that has breakthrough therapy designation from the U.S.

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