GlaxoSmithKline makes US$3.6bn acquisition of Stiefel

GlaxoSmithKline is to acquire Stiefel, significantly boosting its presence in dermatology. The combination will lead to the creation of a dermatology business with sales of approximately US$1.5bn. It will operate under the Stiefel identity within the GSK Group.

Andrew Witty, chief executive of GSK, said: "This transaction will create a world-leading, specialist dermatology business and re-energise our existing dermatology products."

Charles W Stiefel, chairman and chief executive of Stiefel, added: "This deal will increase the value of Stiefel's unparalleled dermatology pipeline by expanding the customer base to which we will be able to offer these products."

GSK's key dermatology brands include Bactroban, Cutivate and recently launched Altabax. Stiefel's brands are Duac, Olux E and Soriatane.

Sales of GSK's prescription dermatology products were approximately US$550m in 2008, compared with Stiefel's US$900m.

Stiefel currently has more than 15 projects in late-stage development for conditions such as acne, dermatoses and fungal infection.

Charles Stiefel will lead the new business when the transaction closes in the third quarter of 2009.

Stiefel's products will benefit from GSK's global distribution and commercial organisations, particularly in Brazil, Russia, India, China and Japan.

GSK's products will benefit from Stiefel's specialist sales force, relationships and experienced management in dermatology.

The companies expect to make pre-tax cost savings of up to US$240m by 2012 with integration costs of approximately US$325m over the next three years.