GlaxoSmithKline To Buy Novartis Out Of Joint Venture
How buying Novartis out of Joint Venture will provide GlaxoSmithKline increase focus in Oral Health Products.
Bloomberg News (3/27, Paton) reports GlaxoSmithKline will buy Novartis’ stake in the companies’ joint consumer health venture, which includes pain relievers and cold remedies. In other words, GSK is “doubling down on consumer health,” while Novartis is narrowing “its focus on prescription medicines.”
GSK will pay Novartis $13 billion for the stake. The new bosses of two of Europe’s largest drugmakers are pivoting in different directions.
Chief Executive Officer Emma Walmsley’s Glaxo agreed to pay $13 billion. Novartis’s stake in a joint venture that includes Panadol pain relievers and Theraflu cold remedies. This agreement will result in more firepower for the Swiss giant’s drug business and acquisitions.
Additionally, Fortune (3/27, Meyer) reports that
“GSK said it would launch a review of its consumer healthcare nutrition products. This will help fund the joint venture buyout, focusing its efforts on medicines and the oral health category.”
“While our consumer healthcare joint venture with GSK is progressing well, the time is right for Novartis to divest a non-core asset at an attractive price.”. “This will strengthen our ability to allocate capital to grow our core businesses. It will drive shareholder returns, and execute value-creating bolt-on acquisitions. We continue to build the leading medicines company, powered by digital and data.”, says aid Novartis CEO Vas Narasimhan.
Novartis’s four appointees on the joint venture’s board will step down when the transaction closes.
Telegraph (UK) (3/27, Withers, Torrance)
In addition, “GSK said it was considering a sale of malted drink brand Horlicks its other consumer nutrition products to help fund the takeover. This will, therefore, make the shift division’s focus toward over-the-counter medicine and oral health products such as toothpaste and mouthwash.”
Article from: ADA Morning Huddle
Lorin Berland, DDS