GlaxoSmithKline, Pfizer form new company to fight HIV

Posted April 16, 2009

— Drug giants GlaxoSmithKline (NYSE: GSK) and Pfizer (NYSE: PFE) are joining forces to fight HIV by creating a new, jointly owned company.

The partners made the announcement Thursday morning before markets opened in New York.

The deal allows the two companies to merge their strengths in the HIV drugs business - Glaxo is a big seller of HIV treatments but its products are relatively old and its pipeline of future drugs is also relatively weak. Pfizer, on the other hand, has a significant store of drugs in development but few products on the market.

“Today marks a definitive step by GSK to renew our focus and deliver more medicines, more efficiently, to people living with HIV/AIDS,” said GSK Chief Executive Officer Andrew Witty. “At the core of this specialist business is a broad portfolio of products and pipeline assets, which can be more effectively leveraged through the new company’s strong revenue base and dedicated research capability. HIV remains a global threat with increasing incidence and viral resistance. This new company will be better placed to meet these challenges and improve access to treatments.”

London-based Glaxo, which maintains its U.S. headquarters in Research Triangle Park and employs some 5,000 people in the Triangle area, will initially hold an 85 percent equity interest in the new company, with New York-based Pfizer holding the remaining 15 percent.

The two companies said that the new business "will be more sustainable and broader in scope than either company's individually," adding that it will hold a 19 percent share of the growing market.

The new company will have a broad product portfolio of 11 marketed products including market-leading therapies such as Combivir, Kivexa and Selzentry/Celsentri. Based on 2008 results, the combined portfolio generates sales of around 1.6 billion pounds ($2.4 billion).

The companies said revenues at that level will provide the new company with financial stability and support investment in its pipeline.

"By combining Pfizer's and GlaxoSmithKline's complementary strengths and capabilities, we are creating a new global leader in HIV and reaffirming our ongoing commitment to the treatment of the disease," said Pfizer Chief Executive Officer Jeff Kindler in a joint statement issued to the London Stock Exchange.

"With the strength of the companies' current HIV products, as well as the complementary fit of Pfizer's HIV pipeline and GSK's global distribution capabilities, the new company is well positioned to bring new and improved medicines to patients with more speed and efficiency," Kindler added.

The company will have a pipeline of 6 innovative and targeted medicines, including 4 compounds in phase II development. Altogether, the new company will have 17 molecules at its disposal to develop in fixed-dose combinations as possible new HIV treatments.

The new company will contract research and development services directly from Glaxo and Pfizer to develop new medicines.

GSK’s Dominique Limet will be the CEO of the new venture. He currently is senior vice president and head of GSK’s Personalized Medicine Strategy.

Other board members of the new venture are:

  • Julian Heslop, chief financial officer, GSK and chairman of the new HIV company
  • Cees Heiman, regional president, Specialty Care Business Unit, Europe, Pfizer
  • Zhi Hong, SVP and head of Infectious Diseases CEDD, GSK
  • Abbas Hussain, president Emerging Markets, GSK
  • Duncan Learmouth, SVP Corporate Communications & Community Partnerships, GSK
  • Martin Mackay, president, Global Research & Development, Pfizer
  • Ian McCubbin, SVP Strategy, Logistics and External Supply, GSK
  • Ellen Strahlman, SVP and Chief Medical Officer, GSK

This story is closed for comments.

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  • mjones3 Apr 17, 2009

    death row....your post I vile, absolutely vile!

  • mjones3 Apr 17, 2009

    Hip-shot.....I would like to say that we absolutely need more drugs to treat HIV. Yes, we need a vaccine and a cure but new drugs are needed as well. When most HIV infected people are on these drugs for an extended amount of time, there is a possibility to build a resistance to them. Then the infectious disease doctor must prescribe another one perhaps in another family of drugs to find another effective combination to sustain the persons immune system. Until there is a cure, there will always be a need for new drugs for HIV positive people.
    I hope and pray this joint venture is successful and assists many, many people with new options for meds.

  • Hip-Shot Apr 16, 2009

    "There is no profit in a finding a cure for HIV. There is however plenty of profit in managing the affects of HIV. "

    Absolutely. The world needs a vaccine to prevent this deadly disease or a cure, not new drugs to add to the cocktail used to treat the symptoms. However, there is less profit in finding a solution.

    Its the same thing with SSRI's. There are side effects that last after continuation however no one wants to cure those, but would rather produce drugs to treat the symptoms.

  • Timbo Apr 16, 2009

    "There is however plenty of profit in managing the affects of HIV."

    What are the "affects" of HIV that are being managed? What do you mean? HIV if treated with meds is manageable.

    Besides, HIV meds have the least profit margin in Pharma.

    You have no idea and are spouting off a tired and lame mantra.

    Let's look at it from a pure profit and loss scenario. If you don't treat HIV, the infected person will slowly succumb to opportunistic diseases, have to quit work, and go on government assistance, and enter the hospital many times on your tax nickle until they ultimately die a nasty death.

    Now, if the infected person takes meds that can keep them relatively healthy, they can continue to work, pay taxes and lead productive lives.

    I think obvious that it is more cost effective to continue to develop meds for HIV.

    Not to mention it's just the right thing to do?

  • SilverWolf Apr 16, 2009

    There is no profit in a finding a cure for HIV. There is however plenty of profit in managing the affects of HIV. The drug companies haven't cured anything since polio and I don't see them changing tactics anytime soon. Better for the profit margin to keep people on treatment rather than finding cures for diseases these days. Just another example or our wonderful corporations looking out for the citizens. NOT!!!

  • JustOneGodLessThanU Apr 16, 2009

    Ah, leave DeathRow-IFeelYourPain-NOT're taking away all of his enjoyment from hoping & watching people die.

  • FairPlay Apr 16, 2009

    That is an incorrect statement to say a "sin" virus, and ignorant. HIV and Aids can be caught of a simple transfusion ( like Ryan White) and in hospitals by workers. It started in Monkeys and tranferred to man by open cuts and cutting monkey meat to eat. No sin origin.

  • kikinc Apr 16, 2009

    It's not a 'sin' virus. It's ignorant statements like that are the reason we are behind in finding acceptable treatments, and maybe even a vaccine for HIV. If funding in the early 80's had been given, instead of withheld b/c it was a "gay disease," we might be ahead of the game. And, no, there probably never will be a cure, but that's due to the fact that it's a retrovirus, which has a mutation rate we can't keep up with. The best bet is a vaccine to prevent the spread outright.

  • DeathRow-IFeelYourPain-NOT Apr 16, 2009

    They're workin' hard to develop a 'sin' drug. I don't see a cure in any of our lifetimes. There will always be uncurable 'sin' viruses.