Pliva this morning said it has completed the sale of its R&D unit to GlaxoSmithKline, as its attention turns away from branded pharmaceuticals to copycat medicines. Sealing the deal has realised a $35 million payment to Pliva, with milestone fees of up to $15 million in the offing should certain early-stage products be pushed through into the clinic.
The news comes in the midst of an unwelcome bid from Icelandic biotechnology company Actavis to acquire the Croatian firm. The latter upped its offer to $1.85 billion towards the end of last month, but Pliva’s management have given this improved bid only a lukewarm reception – saying it is still too low. Perhaps more enticing is that a combination between the two firms would elevate them into third position in the global generics business behind Sandoz and Teva and ahead of Merck KGaA.
Pliva said that the sale will positively affect its financials this year, with an exceptional gain of $20 million forecast for the second quarter, although it will be negatively impacted to the tune of $6 million for the ongoing financing of the R&D unit through to the deal close. GSK says it will take on board all 130 employees currently housed at the research institute, of which it gains full ownership.