Pharmaceutical giant GlaxoSmithKline (GSK) has snapped up an American cancer drug maker in a £1.5billion deal.
California-based Sierra Oncology is working on treatments targeting rare forms of cancer.
The deal comes as GSK’s chief executive, Dame Emma Walmsley, has been facing mounting calls to shore up its drug pipeline since Elliott, a US investor, built up a big stake last year.
Pressure: GSK chief exec, Emma Walmsley (pictured), has been facing calls to shore up its drug pipeline since Elliott, a US investor, built up a big stake last year
Sierra’s momelotinib is being tested for use on patients suffering from myelofibrosis, a fatal bone marrow cancer.
It tends to be diagnosed at around the age of 65, with victims living on average for eight more years. The drug cuts the requirement for patients to receive blood transfusions and treats the illness’s symptoms.
Sierra reported positive results from a clinical trial of the drug in January.
The medicine is expected to be submitted to the US Food and Drug Administration for approval and to EU authorities in the second half of this year.
If it clears the regulatory hurdles, sales of the drug are predicted to begin in 2023.
GSK is paying £1.5billion in cash for Sierra, which will give it access to momelotinib and complement its existing expertise.
Analysts at investment bank JP Morgan said the purchase ‘makes sense’, noting momelotinib was predicted to achieve sales of up to £481million.
The acquisition complements blenrep, GSK’s treatment for multiple myeloma, another type of blood cancer.
Shares in GSK fell 0.2 per cent, or 2.6p, to 1781.2p.
The acquisition comes as GSK prepares to split off its consumer health arm, which makes products such as Panadol painkillers and Sensodyne toothpaste, into a new company called Haleon.
The division is planned for July, with Haleon due to list on the London Stock Exchange in the summer.
The remaining GSK business will focus on its vaccines and pharmaceutical divisions after the demerger.
