GlaxoSmithKline has bought the US skin care therapy group Stiefel for $3.6bn (£2.5bn), it said yesterday, as the pharmaceuticals giant looks to replace sales it will lose when some of its biggest selling treatments lose patent protection over the next few years.
Stiefel will be merged into GSK's own skin products unit to operate as a business within GSK, and is expected to generate revenues of $1.5bn based on 2008 sales, giving the group an 8 per cent share of the dermatology market.
"As part of our strategy to grow and diversify GSK's business, we are continuing to make new investments through targeted acquisitions," said Andrew Witty, GSK's chief executive. "This transaction will create a new world-leading, specialist dermatology business and re-energise our existing dermatology products."
Mr Witty again stressed that the group intends to continue doing small deals in specialist areas to protect long-term revenues, rather than engaging in mega-merger transactions of the type that have been favoured by other big pharmaceutical companies.
Drugs companies are being forced to act as their established treatments lose patent protection and are copied by generics drugs firms.
"The deal is certainly in keeping with GSK's strategy of avoiding the mega-merger, and opting instead for smaller deals in specialist markets," said Jeremy Batstone-Carr, head of research at Charles Stanley.
GSK's acquisition of Stiefel follows last week's deal with US drugs giant Pfizer to create a new specialist HIV company that will combine the two company's treatments and patented drug development projects. The company is scheduled to announce its first-quarter results tomorrow.