GSK pursues $10.6bn takeover of cancer biotech Nuvalent
GSK is preparing for its biggest acquisition in more than 10 years, agreeing to buy Nuvalent for $10.6 billion in a move that would add two late-stage lung cancer drugs.
The UK pharma group is launching a tender offer to buy shares in Nuvalent at an offer price of $124 apiece, a 40% premium to the Boston-based company's closing share price yesterday, and said it will fund the acquisition using cash and debt.
The deal marks a departure from GSK's strategy of smaller-scale, bolt-on acquisitions, and licensing deals in recent years. It is the largest transaction for the company since its $13 billion buyout of Novartis' stake in a consumer health joint venture in 2018.
Chief executive Luke Miels, who took the helm of GSK at the start of this year, said the deal will give GSK "immediate new sales growth opportunities" and a platform in lung cancer that can be built on with GSK's current pipeline projects, such as B7-H3 targeted antibody-drug conjugate (ADC) risvutatug rezetecan (ris-rez) in phase 3.
That platform is led by the ROS1 inhibitor zidesamtinib (NVL-520) and the ALK inhibitor neladalkib (NVL-655), which are under FDA review for non-small cell lung cancer (NSCLC), with decisions due in September and November this year, respectively.
Zidesamtinib is under consideration as a second-line or later therapy for locally advanced or metastatic ROS1-positive NSCLC, a potential rival to Nuvation's recently approved Ibtrozi (taletrectinib), while Nuvalent is seeking approval for neladalkib in pre-treated advanced ALK-positive NSCLC.
The two drugs both have breakthrough designations from the US regulator and, all going well, could be on the market before the end of the year, said GSK, which reckons they both have "multi-blockbuster potential."
A third drug candidate – small-molecule HER2 inhibitor NVL-330 – is in phase 1 development for HER2-altered NSCLC. Analysts at Jefferies, cited by the Financial Times, have suggested that Nuvalent's entire pipeline could generate sales of $5 billion to $7 billion a year at peak.
It is the second acquisition announced by GSK since Miels took over from long-serving CEO Emma Walmsley, coming after it bought food allergy specialist RAPT Therapeutics for up to $2.2 billion, and also follows other oncology-focused takeovers such as Sierra ($1.9 billion) and IDRx ($1.1 billion) last year.
Meanwhile, in pursuit of a target of building annual sales to £40 billion in 2031 from less than £33 billion in 2025, the group also signed a wide-ranging, $12 billion R&D alliance with China's Hengrui Pharma spanning a dozen drug candidates across respiratory, immunology and inflammation, and oncology.
Liver fibrosis alliance
In a much smaller deal this week, GSK has also paid £44.5 million to University College London (UCL) spin-out Engitix to kick off a partnership seeking out new drug targets in liver fibrosis, with another £118 million in potential milestone payments.
The project will use Engitix's extracellular matrix-based discovery platform to find mechanisms involved in the regression of fibrosis in the liver, and targets for medicines that could promote the process. At the moment, most developers working on liver fibrosis are focusing on targets to prevent progression.
Hepatology is another key R&D focus for GSK, which licensed rights to once-monthly FGF21 analogue efimosfermin from Boston Therapeutics – a potential therapy for steatotic liver disease (SLD) – for $1.2 billion upfront last year, and is also waiting for an FDA approval decision on chronic hepatitis B therapy bepirovirsen in October.
