GSK is sticking to its plan to gradually monetize its stake in Haleon, the consumer health business the British pharma giant spun off in 2022.
GSK has collected about 978 million pounds ($1.24 billion) by selling 300 million shares in Haleon, according to a securities filing to the London Stock Exchange.
The sold shares represent about 3.2% of Haleon’s total ownership, and the sale leaves GSK with roughly a 4.2% stake in the Advil maker. That’s compared to the approximately 13% stake GSK initially held following the demerger of Haleon in July 2022.
GSK’s reduced interest in Haleon doesn’t come as a surprise. The whole point of the consumer health separation was to allow GSK to focus on innovative drugs. All along, GSK has said it plans to monetize its holdings in Haleon “in a disciplined manner” to strengthen its balance sheet.
In a statement to Fierce Pharma, a GSK spokesperson said the company “will continue to follow a disciplined and pragmatic approach for further sales of our stake, which will be dependent on market conditions.”
Pfizer, meanwhile, was GSK’s joint venture partner in Haleon. A separate listing in 2022 left Pfizer holding 32% of the new firm’s shares.
Pfizer hasn’t sold its stake, but it intends to do so gradually so as not to cause too much fluctuation in the independent company’s share price. The New York pharma and GSK agreed not to sell any Haleon shares in the next 60 days following GSK’s latest sale.
At the same time, both GSK and Pfizer have been aggressively adding to their pipelines through dealmaking. For GSK, the plan is to prepare for the patent cliff of its flagship HIV drug, dolutegravir, around 2028.
Last year, GSK paid $2 billion to acquire Bellus Health, gaining a late-phase chronic cough candidate called gefapixant. A few days ago, the British pharma put down $1 billion upfront for Aiolos Bio to get its hands on a long-acting asthma candidate that could challenge Amgen and AstraZeneca’s Tezspire.
In back-to-back deals in October and December, GSK together dished out $270 million in upfront payments for two antibody-drug conjugates from Hansoh Pharma. Both licensing deals could eventually be worth north of $1 billion.
“Our first priority for capital allocation remains to invest in pipeline delivery, both organically and with continued targeted business development,” GSK CEO Emma Walmsley said during a presentation at the annual J.P. Morgan Healthcare Conference last week.
Meanwhile, new launches—such as an RSV vaccine showdown with Pfizer and a myelofibrosis market battle with Incyte—require GSK to spend more on commercialization.
With the help of those new medicines and vaccines, GSK is on track to deliver on its promise to generate 6% to 8% annual compounded sales growth between 2021 and 2026, Walmsley said during her JPM presentation.
As for Pfizer, the New York pharma just splashed $43 billion on ADC specialist Seagen. And a massive cost-cutting program is underway to adjust to the big drop in COVID product sales. Under that effort, Pfizer aims to save $4 billion by the end of 2024.