Source: Sharecast
The FTSE 100 company will pay $124 per share, which is a 40% premium to the last closing price.
GSK said the deal is consistent with its strategy of acquiring assets that have "validated targets and meaningfully address efficacy and/or tolerability limitations of existing standard-of-care therapies". It includes three products in lung cancer in a single transaction.
Zidesamtinib and neladalkib are two late-stage inhibitors for the treatment of non-small cell lung cancer (NSCLC). Both assets have received FDA breakthrough therapy and orphan drug designations and are in review, with target decision dates of 18 September and 27 November 2026, respectively. Subject to approval, they are expected to launch in 2026 and have "multi-blockbuster" potential, GSK said.
The third asset, NVL-330, is currently in phase I trials for HER2-altered NSCLC.
GSK reaffirmed its 2026 full-year guidance range of 7-9% core operating profit and core earnings per share growth. It said the acquisition is expected to contribute to revenue growth from 2027, be incremental to the existing ambition for sales of more than £40bn by 2031 and to strengthen core operating profit through the dolutegravir loss of exclusivity period (2028-2030).
Chief executive Luke Miels said: "Today's acquisition is a multi-product deal, consistent with our approach to acquire assets that have clinically proven targets and meaningfully address an efficacy and/or tolerability gap. The two lead products are potential best-in-class assets that could launch this year if approved by the FDA and offer significant new treatment options to patients with two forms of non-small cell lung cancer.
"The acquisition provides GSK with immediate new sales growth opportunities, improving profit contributions from 2027, and a platform in lung cancer for rapid expansion with Ris-Rez, our B7-H3 targeted ADC in phase III clinical development."
At 1127 BST, GSK shares were down 2.6% at 1,863.50p, while Nuvalent was up a whopping 39% in pre-market trade at $122.94.
Russ Mould, investment director at AJ Bell, said: "New GSK chief executive Luke Miels isn’t hanging around as he puts his mark on the business. Less than six months into his tenure he has committed to the company’s largest acquisition in more than a decade.
"The takeover of US cancer specialist Nuvalent fits with the group’s strategy of focusing on oncology as a key engine of growth for the business. It could also help support an ambitious target of achieving £40 billion in revenue by 2031.
"The initial share price response indicates some trepidation among investors which is understandable given the size of the takeover. GSK is paying a hefty premium to get the deal over the line and the two big lung cancer products flagged by Miels in heralding the takeover still await regulatory approval. Any acquisition of this size will always face challenges around integration.
"With GSK having fallen behind its UK counterpart AstraZeneca in share price terms in recent years, Miels clearly felt a slow and steady approach wasn’t going to get the job done. In rolling the dice on such a big transaction, he is undoubtedly taking a risk."
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