Novartis swaps products with GlaxoSmithKline, sells unit to Lilly

In what looks like a significant restructuring of company focuses, Swiss drug major Novartis (NOVN: VX) and UK peer GlaxoSmithKline (LSE: GSK) have entered into a three-part accord to exchange certain assets, and Novartis will sell its animal health business to the USA’ Eli Lilly (NYSE: LLY).

Under the agreement, Novartis would strengthen the company's innovative pharmaceuticals business by acquiring GSK oncology products, and would divest Vaccines (excluding flu) to the UK firm. The two companies would also create a joint venture, combining their consumer divisions to create a world-leading consumer health care business.

The news was well received by investors, with Novartis’ shares rising 2.3% to 76.50 Swiss francs and GSK advancing 5.4% to £16.425 on the news this morning.