Sandoz to acquire GSK’s antibiotics business

Pharma News: Sandoz, a Novartis division, is set to acquire GSK’s antibiotics business, reinforcing its leading global position in antibiotics.

The agreement includes the rights to three established brands (Zinnat, Zinacef and Fortum) in more than 100 markets.

Sandoz will pay GSK USD 350 million at closing, plus additional milestone payments of up to USD 150 million. Closing of the transaction is expected in the second half of 2021.

In line with its integrated manufacturing strategy, Sandoz intends in the longer term to manufacture Zinnat at sites in its own network, which has global antibiotics production in Austria. Once the transaction is completed, GSK will supply Zinnat to Sandoz under a manufacturing and supply agreement (MSA), while supporting a transfer of the related manufacturing operations to Sandoz lasting approximately four years.

“This important transaction will further position Sandoz as a global leader in antibiotics – truly essential medicines that are the backbone of modern healthcare systems,” said Sandoz CEO Richard Saynor.

“Cephalosporins are the largest antibiotic segment by global sales and acquiring this leading business, including the established global Zinnat brand, will complement our #1 position in generic penicillins, the other key segment. It will also set us up for additional synergies driven by an increased promotional footprint that will support growth of both the acquired brands and the current existing Sandoz portfolio.”

While Novartis is shoring up its position in generic antibiotics, the drugmaker decided the pursuit of new drugs that might help stem the rising tide in antimicrobial resistance (AMR) was too challenging, joining several other big pharma companies – including AstraZeneca, Roche, Bristol-Myers Squibb and Eli Lilly – in ducking out of the field.

The mass exodus of pharma majors from the antibiotics research category stems mainly from the difficulties in getting a return on investment. Late in 2020, Australia’s MTPConnect announced the formation of an Australian-first network bringing together key stakeholders to address the impact of antimicrobial resistance (AMR) on human health.

The Sandoz/GSK agreement excludes the rights in the US, Australia and Germany to certain of those brands mentioned above, which were previously divested by GSK, and in India, Pakistan, Egypt, Japan (to certain of the brands) and China, which will be retained by GSK.

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