GSK completes £1.35 billion Suntory deal
pharmafile | September 10, 2013 | News story | Sales and Marketing | GSK, Suntory, lucozade, ribena
GlaxoSmithKline has confirmed it is to sell Lucozade and Ribena to Japanese drinks giant Suntory Beverage & Food for £1.35 billion in cash.
The move had been widely trailed last week and makes good on a commitment that GSK announced in April to offload the brands – GSK’s first major divestment of non-core consumer goods.
The soft drinks had combined sales last year of around £0.5 billion: the deal with Suntory is expected to go through by the end of the year, subject to regulatory approvals.
“Lucozade and Ribena are iconic brands that have made a huge contribution to GSK over the years, but now is the right time to sell them,” explained David Redfern, GSK’s chief strategy officer.
The company has been “increasing its focus around a core portfolio of healthcare brands” in consumer health, and is particularly interested in emerging markets.
For its money, Suntory gets global rights to the brands and GSK’s Coleford manufacturing site, which is located in the Forest of Dean in the UK, and the ‘vast majority’ of staff will transfer to the Japanese firm.
Redfern said GSK was now going to concentrate on “the delivery of our late stage pipeline of pharmaceuticals and vaccines” – although last week the company suffered a blow in this area when its skin cancer vaccine MAGE-A3 failed to beat placebo in a late-stage study.
The manufacturer is continuing to evaluate the drug in another Phase III study, known as MAGRIT, in non-small cell lung cancer following surgical removal of the primary tumour. First data from this trial is expected early next year.
GSK wants to compete with Bristol-Myers Squibb, which launched the world’s first melanoma vaccine, Yervoy (ipilimumab), in 2011.
Indeed, many of GSK’s recent activities seem a world away from the beverages market, such as its establishment last month of a £50 million venture capital fund to invest in the emerging field of bioelectronics.
Described as one of the ‘medicines of the future’ by company R&D head Moncef Slaoui, bioelectronics is a burgeoning area of therapy that seeks to treat medical conditions by manipulating nerve activity.
Adam Hill
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