GSK, Flagship enter multibillion-dollar drug discovery deal
GSK and Flagship Pioneering entered a partnership to develop as many as 10 new drugs in a deal that could pay more than US$7 billion to firms supported by the venture capital biotech.
Flagship, which created mRNA Covid-vaccine maker Moderna, and GSK will jointly put US$150 million upfront towards exploring new respiratory and immunology treatments, according to a statement on Monday (Jul 29). GSK will commit as much as US$720 million for each of the 10 drugs, including upfront payments, if they reach all of their development and commercial milestones.
Chief executive officer Emma Walmsley is working to hone GSK’s product portfolio, and the deal with Cambridge, Massachusetts-based Flagship is aimed at fields where the drug giant has been working to expand. Earlier this year, GSK agreed to buy US biotech Aiolos Bio for as much as US$1.4 billion to gain its experimental asthma drug.
GSK shares rose as much as 1.3 per cent in London. They gained 7.7 per cent this year through Friday’s close.
GSK has been beset with investor concern about drugs including a mainstay antiviral reaching the end of their patents, allowing cheaper copies to compete with them in the market. Last year, it acquired Canadian biotech Bellus Health in 2023 for about US$2 billion to secure a promising cough medicine.
Under founder and current CEO Noubar Afeyan, Flagship develops scientific ideas in-house, focusing on platform companies that can produce multiple products. The fund also supported Editas Medicine, the gene editing company that Crispr Nobel Prize winner Jennifer Doudna co-founded in 2013.
GSK’s share price growth has lagged behind that of rival British pharmaceutical company AstraZeneca, weighed down by concern about litigation over whether its former heartburn drug Zantac causes cancer. BLOOMBERG
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