In a new agreement, giant pharmaceutical multinationals GlaxoSmithKline Plc and Pfizer Inc., the two leading developers of AIDS drugs, set up a joint company to develop drugs against HIV. This new company will hold nearly a fifth of the market for treatments against the virus. Glaxo will initially have an 85 percent stake in the joint venture. Pfizer will have the remaining 15 percent. Through the years, Glaxo has reflected a more dominant position in marketed products. Both companies admit, though, that this scenario is bound to change in the future.
The merger is yet another manifestation of an apparently increasing trend by big pharmaceutical manufacturers to collaborate in the cost-intensive and highly risky venture of drug development, with R&D occupying most of the cost and investment risks. Both companies expect that the union will enable them to build more sustainable and cost-effective processes in developing drugs.
’Join forces’ is the philosophy announced by the union of the two pharmaceutical giants. Their aim is to address competition from other firms in the lucrative market for antiretroviral drugs. The new company whose name will not be known until the union is complete before end of the year, will have a total of 11 drugs against the AIDS virus and another six under development. These represent 19% of the market. It is estimated that there are 33 million carriers worldwide, mostly in developing countries.
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