British pharmaceutical group GSK announced Tuesday a $10.6-billion deal for Nuvalent, a Boston-based specialist in cancer treatments, furthering its push into both oncology and the United States.
The deal includes Nuvalent’s three lung cancer therapies currently in their testing phase, GSK said.
Two of the treatments, zidesamtinib and neladalkib, “are potential best-in-class assets that could launch this year if approved” by the US Food and Drug Administration, GSK chief executive Luke Miels said in a statement.
Nuvalent’s CEO James Porter said “GSK’s proven track record, infrastructure, and expertise will support the successful commercialisation” of the two drugs “as well as accelerate advancement of our broader discovery pipeline”.
The pharmaceutical industry has faced turbulence from US President Donald Trump’s tariff threats since last year, which aim to encourage investment in the United States and reduce drug prices.
GSK, along with other non-US pharmaceutical giants, agreed in December to lower the cost of its prescription medicines for American patients in exchange for tariff exemptions for three years.
Miels took the helm at GSK in January, succeeding Emma Walmley after nearly nine years as CEO. He was previously the group’s chief commercial officer.
His first set of earnings results as group boss showed that net profit rose seven percent in the first quarter from the year earlier, thanks to speciality medicines targeting cancer, HIV and respiratory diseases.
GSK’s revenue from oncology drugs jumped 23 percent in the quarter.
The United States meanwhile accounted for more than half of the company’s total revenue last year, when it targeted investment in the US totalling $30 billion through to 2030.
– Share price drop –
GSK’s share price slid 3.6 percent in morning deals after the announcment, making it the biggest faller in London’s benchmark FTSE 100 index, which was down slightly overall.
Nuvalent, which is listed on the Nasdaq index in New York, is being bought at a 40-percent premium to its recent share price.
“The deal strengthens GSK’s position in targeted cancer therapies and reflects the first major acquisition since Luke Miels became CEO, and the first step in his push to rebuild the company’s drug pipeline,” said Anna Macdonald, investment strategy director at Hargreaves Lansdown.
Neil Wilson, investors strategist at Saxo UK, said GSK’s shares took a knock because it had agreed to an all-cash purchase.
But “the deal… gives GSK a couple of potential blockbuster lung cancer drugs”, he said.
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