Novartis transforms drug business via deals with GSK and Lilly

Tags: Drug, GSK, Lilly, Novartis, News
Swiss drugmaker Novartis is transforming its business by exchanging certain assets with GlaxoSmithKline and divesting its animal health business to Eli Lilly in deals worth billions of dollars. The revamp, announced on Tuesday, is the result of a keenly awaited strategic review at the company.

Chief Executive Joe Jimenez said the changes would focus the company on innovative businesses with global scale. "They also improve our financial strength, and are expected to add to our growth rates and margins immediately," he said.

Novartis said it had agreed to acquire GSK's oncology products for a $14.5 billion payment. The Swiss drugmaker will also divest its vaccines business, excluding flu, to GSK for $7.1 billion plus royalties.

In a separate transaction, Novartis said it had agreed to divest its animal health division to Eli Lilly for approximately $5.4 billion.

The deals mark a major reorganisation for GSK too, which is to return 4 billion pounds to shareholders following the changes. GSK will take the lead in running a future consumer health business with Novartis but will effectively give up its ambitions to be a global leader in oncology.

GSK said the company would in future have a balanced business centered around consumer health, vaccines, respiratory and HIV medicines, which together would account for about 70 percent of revenues.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Jaitley must have a workable gameplan

    While governments, irrespective of their political hues, cannot be faulted for mobilising non-tax revenues, overtly relying on these sources of fundin

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Urs Schöttli

It’s time for Japan to step out of its shell

The execution of a Japanese hostage by ISIS has sho­cked ...

Zehra Naqvi

The urge to tell stories

One wants to tell a story, like Scheherzade, in order ...

Bubbles Sabharwal

Truth about truth

The question to ponder is, “is it the truth because ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture