LONDON: December 21, 2018. With potential relevance to the air cargo industry, pharmaceutical giants GlaxoSmithKline and Pfizer are to combine their consumer health businesses in a new joint venture with annual sales of US$12.7 billion.

GSK will control 68 percent of the new joint venture and Pfizer the remaining 32 percent and lead to the creation of two new UK-based global companies focused on Pharmaceuticals/Vaccines and Consumer Healthcare.

The two companies will combine GSK’s OTC products including Sensodyne, Voltaren and Panadol and Pfizer’s Advil, Centrum and Caltrate.

“Through the combination of GSK and Pfizer’s consumer healthcare businesses we will create substantial further value for shareholders,” declared GSK CEO Emma Walmsley (pictured).

“With our future intention to separate, the transaction also presents a clear pathway forward for GSK to create a new global Pharmaceuticals/Vaccines company, with an R&D approach focused on science related to the immune system, use of genetics and advanced technologies, and a new world-leading Consumer Healthcare company,” she continued.

As at 31 December 2017, GSK’s consumer healthcare business assets were £16 billion, with sales of £7.1 billion; adjusted operating profit of £1.25 billion; operating profit of £891 million and profit before tax of £884 million.

By the same measure, Pfizer’s consumer business was valued at US$10 billion with sales of US$3.46 billion; adjusted operating profit of US$600 million; operating profit of US$471 million and profit before tax of US$471 million.

Subject to shareholder and anti-trust approvals, the transaction is expected to close in the second half of 2019. GSK has agreed to pay a “break fee” of US$900 million if its Board changes, withdraws or qualifies its recommendation; shareholders vote on the proposed transaction but don’t approve it by 30 September 30, 2019; or by March 31, 2020 at the latest due to any delay in anti-trust approvals.