GSK to sell stake in respiratory partner Innoviva for $392m

GlaxoSmithKline (GSK) has agreed to divest the complete stake in its respiratory drug partner Innoviva for about $392m, or $12.25 per share.

Under the terms of a definitive agreement, GSK will sell its nearly 32 million shares, or 32% of the outstanding common stock, back to Innoviva at a 3% discount.

A royalty management company, Innoviva gets royalties from GSK for respiratory assets Trelegy Ellipta, Relvar/Breo Ellipta and Anoro Ellipta. Last year, these products generated $1.15bn (£819m), $1.5bn (£1.1bn) and $773m (£547m) in sales, respectively.

The companies noted that the terms of their respiratory partnership will remain unchanged.

After completion of the divestiture, GSK will not own any Innoviva stock. GSK intends to use the proceeds from the transaction to support investments related to its strategic priorities.

Innoviva CEO Pavel Raifeld said: “We view the buyback as a compelling and highly accretive transaction demonstrating our ability to act strategically and opportunistically at the same time.

“We are confident in the collaboration products’ excellent commercial prospects, especially given strong recent performance in the face of a challenging environment, and look forward to continued work with GSK to address significant unmet medical needs for patients suffering from respiratory diseases.”

In July last year, GSK agreed to invest up to €150m for a 10% stake in German biotech CureVac.

Separately, Pfizer and its partner BioNTech have signed a new agreement with the European Commission (EC) for up to 1.8 billion doses of the companies’ Covid-19 vaccine, Comirnaty.

This brings the total potential Comirnaty doses reserved for the EC to up to 2.4 billion.

As part of the latest deal, the companies will deliver 900 million vaccine doses on a monthly basis starting in December this year and continuing into 2023.

The EC also holds an option to acquire up to an additional 900 million doses.