GlaxoSmithKline Oncology/Novartis Vaccines (excluding flu)
Deal value: Vaccines--$7.05 billion; Oncology--$16 billion
Deal status: Open
2014 saw Big Pharma eagerly embrace the slim-down craze, which involves drugmakers casting off noncore units to zero in on the things they do well. And nobody capitalized on the trend last year quite like Novartis ($NVS) and GlaxoSmithKline ($GSK).
The two agreed on a multibillion-dollar asset swap that reshaped the fields they play in, vaulting Glaxo to the top of the vaccines and consumer health spaces while making Novartis a force to be reckoned with in the oncology arena.
Novartis was happy to hand over its vaccines unit--including its flu offerings, of which GSK already had its own--after struggling to stay afloat in the market for years. Since it entered the space in 2006 with its Chiron buyout, the Swiss pharma hadn't really found its place in the sun, and the Glaxo transaction got hefty operating losses off its hands. At the center of the deal was Bexsero, a meningitis B vaccine the FDA approved this January; the British drug giant said it would help its vaccines unit churn out 14% of its top-line haul going forward.
|GSK CEO Andrew Witty|
In return, the Basel-based drugmaker netted Glaxo's oncology unit, which includes new drugs Tafinlar and Mekinist for melanoma. The way GSK CEO Andrew Witty put it, though the company's vaccines assets were valuable, they would have paid off little by little--long-term profits instead of a present-day cash infusion. Now, they'll join a Novartis portfolio that already includes blood-cancer treatments Gleevec and follow-up Tasigna.
The two companies also joined hands on a consumer health JV, which will become the world's biggest player in the space with about $10 billion in annual sales. The venture will bring power brands from each giant under one roof, including Novartis pain reliever Excedrin and Glaxo's antismoking products Nicorette and Nicoderm. But the British pharma will have managerial control, as well as the larger stake at 63.5%.
Special Report: The top 5 vaccine makers by 2013 revenue - GlaxoSmithKline - Novartis
GlaxoSmithKline and Novartis, starring players in a Big Pharma deal bonanza
GlaxoSmithKline pledges $7.1B to add Novartis vaccines to its leading lineup
Novartis, GSK team up in consumer JV to save big money, gain big scale
$16B deal for GlaxoSmithKline oncology meds turns Novartis into cancer heavyweight
--Carly Helfand (email | Twitter)