According to a report, GSK has bundled the products into three separate packets in order to attract regional buyers.
As the GlaxoSmithKline‘s (GSK) joint consumer healthcare venture with Pfizer nears a launch, the U.K.-based pharma company is eying the sale of some consumer health brands.
On Wednesday, Reuters reported that GSK was planning to raise about $1.26 billion from the sale of non-core drugs. Citing unnamed people “familiar with the matter,” Reuters said GSK has bundled these assets into three different portfolios and is marketing the products to different bidders. The bundles are divided into Latin American drugs, Physiogel skin care products and European drugs. The packages of the Latin American Drugs and Physiogel products have been sent to prospective bidders over the past week, while the European packet, which is expected to garner a higher price, will be sent out later this summer.
In its report, Reuters said one of the sources that spoke on condition of anonymity said “the three portfolios which are up for sale have combined revenues of 200 million-300 million pounds, with the European portfolio representing about 40% of the combined sales.”
There are a number of potential bidders that are speculated to make a play for the different packets of drugs. Among them is Advent, a private equity firm that is expected to bid on the European assets in order to bolster its acquisition of the generic drug firm Zentiva. Another potential set of bidders is Bain Capital and Cinven, which control the Germany-based company Stada. Stada owns the U.K. consumer products maker Thornton & Ross, Reuters said. Earlier this month, Stada acquired five skin care brands as well as a pediatric cough remedy from GlaxoSmithKline. At the time of the deal, Stada said the acquisition of the assets will strengthen the group’s “position as a go-to partner in the European Healthcare market, and will seize the opportunity to be a leading company in consumer health as well as generics.”
The Physiogel portfolio is expected to draw interest from Asian buyers due to the significant presence of GSK’s skincare products across that region, Reuters said.
GSK did not provide a comment to Reuters regarding the potential sales.
In December, GSK and Pfizer combined their consumer healthcare businesses into one entity in order to create a global consumer healthcare company. Between the two companies, their healthcare products generated a combined $12.7 billion in 2017. Products the merged consumer healthcare company will sell include Pfizer’s Centrum and Caltrate and GSK’s Excedrin and Nicorette.
As the companies form this new entity, GSK will have controlling interest. Pfizer will receive a 32 percent equity stake in the company. The new healthcare venture will primarily eye the United States and China for growth, Reuters noted.
GSK plans to spin off the consumer healthcare business into its own entity, which will allow the parent company to focus on pharmaceuticals and a long term growth plan that is focused on the immune system and genetics previously laid out by Chief Executive Officer Emma Walmsley and R&D head Hal Barron.