Gsk Share Discussion Threads

[alphorn] 04/12/2018 15:06

Fangorn - probably valid.

On the plus side it looks as though Niraparib (Zejula) has moved quickly to approval so probably has long IP protection for further development.

[fangorn2] 04/12/2018 14:58

The only people who know the true value of this deal are GSk management

Disagree.

I'd say it is Tesaro management - the people selling out to GSK.

Glaxo's $5 Billion Takeover of Tesaro Seen as Too Expensive

[warranty] 04/12/2018 14:34

The only people who know the true value of this deal are GSk management. It may turn out to be a giant white elephant or on the other hand an inspired and transformative addition. We have some of the most knowledgable people on the planet making this decision and I'd rather put my faith in their opinion than people on here or hacks writing blogs. As long as they maintain the dividend I'm happy to back them to build gains over time.

[philanderer] 04/12/2018 13:42

Some comment from Soc Gen and Kepler here (fairly negative)

[tim 3] 04/12/2018 12:14

We knew what you meant ;)

Yes I think she knows cutting the divi would be suicide as far as investors are concerned.

[rikky72] 04/12/2018 10:35

After yesterday I meant! Doh! Sharp falls are clearly no good for my sanity

[rikky72] 04/12/2018 10:33

Always quick to fall and slow to climb but a better start than expected after tomorrow. Think a lot of it was worries about the divi but mgmt seem to be saying this will be maintained at current level

[philanderer] 04/12/2018 09:15

Hopefully stabilised. Need some positive broker comment to turn us around.

[oriana2] 04/12/2018 08:54

I should have used Ladbrokes.

[montyhedge] 04/12/2018 08:31

Lol spent the money before she has received the cheque, sounds familiar.

[loftus16] 04/12/2018 08:11

More a bolt on than a Sykes type takeover.

[montyhedge] 04/12/2018 08:09

Yes big bet, ego trip perhaps.

[zho] 04/12/2018 07:50

GSK’s £4bn punt on biotech pipeline is chunky but expected

On Monday morning, GlaxoSmithKline’s shareholders applauded the sale of Horlicks, plus a few add-on products, to Unilever for £3.1bn. In the afternoon, they experienced a bout of nerves as the chief executive, Emma Walmsley, spent the proceeds before they had arrived by agreeing to pay £4bn for Tesaro, a US biotechnology firm with a promising drug for ovarian cancer. GSK’s shares fell 7%.

The reaction is, perhaps, understandable. A £4bn punt on a biotech pipeline is chunky even for GSK, as demonstrated by the short-term effect on earnings: they’ll be diluted by “mid to high single digit percentages” for two years and the longer-term benefits, assuming they arrive, won’t be felt until 2022. By contrast, the Horlicks collection offered the warm glow of predictable cashflows.

GSK shareholders cannot, however, grumble about Walmsley’s switch. She’s been saying for ages that her top priority is to boost the underpowered but core pharmaceutical division. That was the point of hiring Hal Barron, a big name in the US, as chief scientific officer and giving him licence to make a few bets.

The takeover premium on the Tesaro deal – 110% – looks enormous but biotech is that kind of industry: big pharma has to swallow hard and pay up to back its scientific analyses. On this occasion, GSK shareholders can at least take comfort that Luke Miels, another Walmsley recruit, came from AstraZeneca, which makes Lynparza, the main competitor in ovarian cancer to Zejula, Tesaro’s leading product. Miels, in other words, ought to be ideally placed to judge whether Zejula is a future blockbuster.

An open question, though, is how many more big biotech bets Walmsley has in mind. She’s not saying, but may be well advised to prepare the ground if many more £4bn-ish outlays are required to reinvigorate the drugs pipeline. The only certainty at GSK is that shareholders love their dividend. They will not want it to be endangered by many more short-term hits to earnings.

[rikky72] 04/12/2018 00:55

But 'pumping cash' into new and innovative development projects is what pharma R&D is all about. In my view it's better to take a short term hit for a chance at bigger success long term. Of course, at the moment it's just a bet but the reaction is very overdone imho.

[romeike] 04/12/2018 00:27

Tesaro has nearly a dozen oncology assets in its pipeline. I am not sure I trust Bloomberg to comment on the science. Zejula revenues appear to be keeping up with analyst expectations. It is possible that GSK's share price will benefit from having a functional oncology division as this has been cited as one reason investors were looking elsewhere.

[tim 3] 03/12/2018 23:44

And am guessing this is one reason the city not happy.

"The deal is expected to eat into earnings until 2020 as the company pumps cash into research efforts at Tesaro'

[philanderer] 03/12/2018 23:24

Glaxo's £7bn day of drama: Horlicks is sold for £3bn and a US cancer firm is bought for £4bn... But shares tumble 7.6%


Emma Walmsley... 'We are betting on this being a great driver for the company.'

[toffeeman] 03/12/2018 22:47

Thank goodness for guaranteed stops!

[tim 3] 03/12/2018 22:03

VS AZN.Pittyfull.


free stock charts from uk.advfn.com

[porsche1945] 03/12/2018 21:19

Rom, read Bloombergs report on this tonight, zejula or whatever its called is no blockbuster, serious side effects, behind the competition and just hasnt taken off, in fact there are serious doubts about parp technology now. I dont need exciting investments i want profitable ones, gsk has been poorly managed for twenty years and so it goes on, share price ever pathetic.

[philanderer] 03/12/2018 21:01

1518p close stateside

[spyder] 03/12/2018 20:59

Am I the only one who thinks that it is bonkers that the market cap of GSK has fallen by 1.5x more that the cost of this acquisition, how can that make any sense?

[philanderer] 03/12/2018 20:55

GSK have said in the RNS they expect to pay the 80p dividend again



'Crown Labs Acquires Rights to Select Brands from GlaxoSmithKline'

[romeike] 03/12/2018 20:19

You cannot possibly compare Shire's acquisition of Baxalta to this, Baxalta was larger than Shire. Tesaro is tiny compared to GSK and they are buying it at a price not much less than it was trading at as recently as January. Yes is quite an expensive price in the current market, but this was not an uncontested acquisition and Dr Hal Barron has clearly found enough evidence to convince the board to go for the deal.

What are they getting for the money? - a specialist oncology team, proven PARP inhibitor technology, a likely blockbuster drug in Zejula, at least two impressive early stage treatments, as well as an experienced oncology sales team and assets in Boston.

[mj19] 03/12/2018 19:51

With the Novartis deal and this 4 billion it's a lot of cost. Plus Gsk's debt ...... is the divi in tact ?