Novartis has the option to sell its stake in its GlaxoSmithKline consumer health JV to its partner. But it doesn’t sound like that’s what the Swiss drugmaker’s plotting.
As outgoing CEO Joe Jimenez and successor Vas Narasimhan told Bernstein analyst Tim Anderson, the company believes there are a couple years to go before the venture reaches its full potential.
“We want to see the synergies from the combination continue to mature, allowing the stake to increase in value,” they said in quotes paraphrased by Anderson, adding that, “once that happens, we can evaluate what is the right thing to do with that capital.”
As Anderson wrote in a note to clients, that answer “clearly reads that Novartis will not be ‘putting’ its stake to GSK anytime soon,” despite earlier rumors that the Swiss drugmaker could use the money to fund big-time M&A.
Novartis and Glaxo first formed the industry-leading JV in early 2015 with the close of their three-part, multibillion-dollar asset swap. GSK agreed to hold the controlling stake, taking the burden off Novartis, which had been struggling in the consumer health department thanks to quality-control issues and product recalls.
And since then, Glaxo has echoed Jimenez and Narasimhan’s message, ignoring calls for a spinoff and insisting that the unit needed time to come into its own.
Meanwhile, the Jimenez and Narasimhan’s comments should “ease investor concern” about Glaxo scrapping its dividend, Anderson figures—unless, of course, it decides to use the money to go after Pfizer’s consumer business, an asset CEO and former consumer head Emma Walmsley has said the company is looking at.
By Carly Helfand
Source: Fierce Pharma
Monday, the French pharma giant officially moved into its new global home base in Paris, dubbed La Maison Sanofi. The 9,000-square-meter (about 96,875-square-foot) facility comprises two historic buildings and will host around 500 employees, the company explained in a release.
On the first day of the new year, former Sandoz chief Richard Francis will take the reins from Schultz, who is hanging up his CEO hat to retire on Dec. 31, Teva said Monday. The news comes a little more than two weeks after Teva publicly said it was looking for Schultz’s replacement.
General Electric Co. set the terms for the spinoff of its healthcare division, putting an initial value of roughly $31 billion on the soon-to-be-public company. The Boston conglomerate plans to split into three separate public companies by early 2024. Following the healthcare spinoff, it plans to separate its aerospace business from its power and renewable-energy units.