Wednesday, December 19, 2018

GlaxoSmithKline and Pfizer merged their Consumer Healthcare Businesses


Worlds two Pharmaceuticals giants- UK based Glaxo SmithKline and US based Pfizer of  announced  merger of their healthcare businesses to creating the world’s biggest supplier of OTC (Over-the-counter) medicines. 
These include  famous brands  like Anadin, Panadol and Voltarol. This announcement made on 19th December 2018
GlaxoSmithKline and Pfizer merged their Consumer Healthcare Businesses
Image courtesy- Wikipedia
GSK and Pfizer healthcare business merger will make a new combined  consumer healthcare  entity with a worth of £10billion. This merger paves the way for GSK to split into two business entities – One sells OTC medicines and the other engaged in Pharmaceuticals and vaccines. The joint venture will have 68 percent of GSK and 32 percent stake of Pfizer. Both companies are going to list a new Entity of   within three years.

Chief executive of Glaxo- Emma Walmsley told that ‘share holders were pressed the company to split since years, believing there are greater benefits to having two companies, each focused on one area, than in a diversified group.’   
Emma Walmsley said “the transaction also presents a clear pathway forward for GSK to create new global pharmaceuticals / vaccines company… focused on science related to the immune system, use of genetics and advanced technologies” 
“Ultimately, our goal is to create two exceptional, UK based global companies, with appropriate capital structures, that are each well positioned to deliver improving returns to shareholders and significant benefits to patients and consumers,”  she added.
The new entity would have a joint market share that is far exceeded their rivals such as Bayer, Johnson & Johnson and Sanofi.  The new entity if targeting annual savings of £500m ($633milllion) by 2022. GSK’s merger with Pfizer.
GlaxoSmithKline and Pfizer merged their Consumer Healthcare Businesses
image courtesy - Wikipedia

The merger is going to be Mr. Ian Read’s last big venture as a CEO of Pfizer, since he will be succeeded by the company’s chief operating officer Albert Bourla by the end of this year.
 “ We are pleased to announce this new joint venture for Pfizer Consumer Healthcare, delivering on our commitment to complete the strategic review for this business in 2018”  He continued to say “Pfizer and GSK have an excellent track record of creating successful collaborations, and we look forward to working together again to unlock the potential of our combined consumer healthcare businesses”, said Ian Read.
 
GlaxoSmithKline and Pfizer merged their Consumer Healthcare Businesses
image courtesy Pixabay


George Salmon, an equity analyst at Hargreaves Lansdown said that GSK’s decision to split had come as a surprise.
“The separation will take away the steady cash flows of the consumer business, meaning there’s more pressure on the men and women in white coats to deliver the next generation of blockbusters.”

GlaxoSmithKline and Pfizer merged their Consumer Healthcare Businesses
Image courtesy - Pixabay

GSK and Pfizer both are struggling to cope up against the increasing cost of new drugs research as other healthcare companies demanding lesser priced medicines. The GSK & Pfizer merger news pleases shareholders and in-turn GSK's share price surged to 7% on 19th December.



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