Sandoz acquires GSK’s cephalosporin antibiotics business

Sandoz is acquiring GlaxoSmithKline’s (GSK) cephalosporin antibiotics business as it looks to reinforce its global position in antibiotics.

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

It excludes the rights in the US, Australia and Germany to certain of those brands, 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.

In 2020, the three brands had combined sales of approximately USD 140 million in the relevant markets.

Sandoz, a Novartis division, will pay GSK $350 million at closing, plus additional milestone payments of up to USD 150 million, subject to the terms of the transaction.

Closing of the transaction is expected in the second half of 2021, subject to customary closing conditions including regulatory approvals.

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 centered on its lead production site in Kundl, 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.

“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.”

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