GlaxoSmithKline (GSK) is to take a 16 per cent stake in Aspen in exchange for a manufacturing facility and eight medicines, building on the companies’ relationship and the big pharma’s profile in Africa.
Over the past year GSK has built a relationship with South Africa-based Aspen by transferring commercialisation rights to some products in certain markets between he companies.
The deal extends this existing relationship and reinforces GSK’s strategic focus on generics and emerging markets, which it has identified as additional revenue streams to soften the financial blow when it loses exclusivity on some products.
Abbas Hussain, president emerging markets at GSK, said: “Extending our strategic relationship with Aspen supports GSK’s strategy to accelerate sales growth in emerging markets.
“The combination of our commercial activities in Sub-Saharan Africa is highly complementary and will mean that together we can provide more medicines of value to more patients in these countries. At the same time, GSK will also benefit from investing in one of Africa’s leading healthcare companies with a formidable track record of delivery.”
Dissection of the deal
Under the terms of the deal, which is subject to regulatory approvals and predicted to close this year, GSK will acquire 68.5m shares in Aspen, putting the value at around $418m (€306m).
In exchange for these shares GSK is divesting its manufacturing facility in Bad Oldesloe, Germany and eight specialist medicines. The Bad Oldesloe facility produces some of the drugs GSK divested to Aspen in June 2008.
Following completion of the deal GSK and Aspen will collaborate on the commercialisation in Sun-Saharan Africa of their current and future portfolios. Although GSK believes it is contributing the vast majority of the current portfolio it envisages benefiting from the deal.
The company said: “Going forward, the collaboration will build a broader and more diverse portfolio for these countries, with Aspen’s extensive pipeline of new products expected to benefit from greater leverage through GSK’s existing commercial infrastructure.”
In addition GSK is transferring marketing and distribution rights of its pharmaceutical products in South Africa to Aspen, which is intended to take advantage of the latter’s “extensive commercial capability”.