ViiV Healthcare, an unusual collaboration between GlaxoSmithKline and Pfizer, two of the world’s biggest drugs companies, was launched today with a mandate to pool the two firms’ HIV treatments.
ViiV will inherit GSK’s agEing portfolio of HIV medicines, including Combivir, which will lose its patent protection in three year’s time, and Pfizer’s younger and largely untested drugs, such as Selzentry, which ViiV’s chief executive Dominique Limet today described as the company’s “key driver and lever for growth.” Dr Limet takes the helm at ViiV after stepping down as GSK’s head of personalised medicines.
GSK, which is contributing 90 per cent of the £250m start-up costs, will be the major shareholder with an initial 85 per cent of the equity. This also reflects the UK company’s bigger portfolio of marketed drugs, which will initially contribute the most of the new group's revenues.
The equity split will change, however, depending on which company’s medicines and molecules contribute most to profits in the future. The US group has a stronger line of less well developed HIV treatments and will capture a bigger slice of the equity, as much as 30.5 per cent, if its pipeline treatments successfully negotiate clinical trials.
ViiV has 11 marketed medicines and seven molecules in its portfolio.
A number of pharmaceutical groups, including the Swiss giant Roche, have withdrawn from the HIV drug market, blaming increasing difficult commercial conditions.
Dr Limet acknowledged that the market for HIV was challenging: “In truth, we have to get closer to those people who live with the virus,” he said. “Much of our historic effort has been led by the virus – a chase of science. This must continue, but we must also listen and better understand the needs of people living with HIV.”
ViiV has pro forma sales of £1.6bn last year, giving it a 19 per cent market share, behind US group Gilead’s 31 per cent share.
The establishment of ViiV, which was first announced in April, follows GSK’s strategy of concentrating in niche areas, and avoiding costly blockbuster drug research. At the time of the initial announcement GSK’s chief executive Andrew Witty said the deal help the group to guard against the loss of the revenues it will suffer over the next few years as its leading HIV treatments, including Combivir, lose patent protection and are open to competition from generic drug makers.