Gsk under pressure in London, Nuvalent purchase deal weighed down

(Il Sole 24 Ore Radiocor) - Cold reception on the London Stock Exchange for Gsk's acquisition of US-based Nuvalent. The British pharmaceutical giant's stock is at the bottom of the Ftse 100 index. Gsk has reached an agreement to buy Nuvalent, a US biopharmaceutical company specialising in oncology, for $10.6 billion, involving the launch of a tender offer for all outstanding shares of Nuvalent at a unit price of $124 in cash. The premium is 40% over the closing price of $88.49 recorded on Monday. Gsk said the total investment is estimated at $9.4 billion, taking Nuvalent's cash contribution into account. The transaction will be financed through new credit facilities, existing credit facilities and available cash.

Gsk clarified that 'there is no change to full-year 2026 guidance, which forecasts core operating profit and core earnings per share growth of between 7% and 9%'. The group expects the acquisition to contribute to revenue growth from 2027 onwards and the achievement of the target of revenues in excess of £40bn by 2031, and "will strengthen core operating profit during the period when dolutegravir exclusivity expires (2028-2030)". On the other hand, Gsk points out that, 'assuming the transaction closes in the third quarter of 2026, single-digit percentage dilution of core earnings per share is expected for the current year, FY2027 and FY2028', an indication that is negatively received by traders.

The acquisition in any case strengthens Gsk in the field of oncology therapies. Nuvalent brings three therapies for lung cancer: zidesamtinib, neladalkib and NVL-330. Zidesamtinib and neladalkib are currently in late-stage clinical trials for the treatment of non-small cell lung cancer (Nsclc, the most common form of lung cancer, ed) and have received Breakthrough Therapy and Orphan Drug designation from the US FDA. NVL-330 is an early-stage HER2 inhibitor being tested for the treatment of Nsclc with alterations in the HER2 gene. "Today's acquisition is a multi-product deal, in line with our approach of acquiring assets with clinically proven targets that significantly close a gap in efficacy and/or tolerability. The two lead products are potential best-in-class products that could be launched this year if approved by the FDA and offer significant new treatment options for patients with two forms of non-small cell lung cancer. The acquisition offers Gsk immediate new opportunities for sales growth, improved profit contribution from 2027 onwards, and a platform in the lung cancer field for rapid expansion' of gsk's Ris-Rez investigational cancer therapy, the UK company's CEO Luke Miels said in a statement.