GSK Plc agreed to buy Nuvalent Inc. in a deal valued at $10.6 billion, adding a biotech firm that’s developing treatments for lung cancer as the British pharmaceutical company seeks to rebuild its oncology franchise.
GSK will pay $124 a share in cash for Nuvalent, according to a statement Tuesday, a 40% premium over the Cambridge, Massachusetts-based company’s closing share price on Monday. It marks a significant expansion of GSK’s cancer portfolio, which has been slowly growing since the British drugmaker returned to the disease space in 2019, as well as the first major acquisition for Chief Executive Officer Luke Miels.
Since taking over at the start of this year, Miels has been working to revitalize GSK, which doesn’t have a history of risk-taking and has long struggled to allay investors’ fears about the drugs it has in development.
Nuvalent designs small molecule and precisely-targeted therapies for oncology patients including lung cancer. Its shares have declined by 12% this year, giving it a market value of almost $7 billion.
Two of the medicines GSK is acquiring are in late-stage trials, with the US Food and Drug Administration expected to decide on regulatory approval later this year. Both could be blockbuster medicines if approved, GSK said.
The Nuvalent deal won’t impact GSK’s guidance for the year, and it’s expected to contribute to revenue growth from 2027, according to the statement.
The two leading drugs from Nuvalent treat non-small-cell lung cancer patients that have specific mutations. These mutations usually affect people who didn’t smoke.
In January, GSK agreed on a $2.2 billion deal to buy US biotech Rapt Therapeutics, which develops treatments for inflammatory and immunologic diseases. The firm secured a pulmonary hypertension drug in another transaction.
The Nuvalent purchase is expected to be completed by the third quarter, pending regulatory approvals. The transaction will be funded mainly through new and existing debt facilities plus cash and won’t affect GSK’s credit rating, the company said.
