GlaxoSmithKline has retained an 18% minority equity stake in spin-off biotechnology group Convergence Pharmaceuticals, which was officially launched yesterday with financing of $35.4 million from a syndicate of leading European and US life science investors.

Convergence has issued the UK drug giant with $4.7 million worth of shares, in return for two clinical stage assets - target voltage-gated ion channels previously known as GSK1014802 and GSK2197944 - as well as rights to undisclosed earlier stage compounds and contributions in kind.

In addition, GSK stands to receive additional shares on completion of certain milestones related to the assets taken over by Convergence, and has also taken up an observer role on the latter’s board, it said.

Cambridge, England-based Convergence will focus its efforts on the development of analgesic medicines under the direction of Clive Dix - former chairman of the BioIndustry Association and also previously head of R&D at PowderJect - and a management team that includes a stream of former GSK researchers in the field of pain.

There is a significant unmet need to better treat and manage pain around the globe, and Convergence will be hoping to gain a slice of a market already valued at $30 billion and expected to soar to $47 billion by 2023 with the emergence of new therapies for chronic pain, according to Business Weekly.

And GSK will be waiting in the wings to see if its move to cut costs and boost productivity by spinning off chunks of research assets and staff into a separate independent operation will pay off in the long run.

“Big pharma is looking at productivity. It sees smaller companies as more fleet of foot, Dix told the Financial Times. “We are more focused and will be very hungry because the only thing we think about is these drugs,” he added.