Pharma titans merge consumer health businesses

British drug major GlaxoSmithKline (LSE: GSK) and US giant Pfizer (NYSE: PFE) this morning announced their intention to combine their consumer health businesses into a new world-leading joint venture, with combined sales of approximately £9.8 billion ($12.7 billion).

GSK will have a majority controlling equity interest of 68% and Pfizer will have an equity interest of 32% in the JV, and lays the foundation for the separation of GSK to create two new UK-based global companies focused on pharmaceuticals and vaccines and consumer healthcare. GSK’s shares jumped 7.29% to 1,553.80 pence soon after markets opened this morning.

GSK has already significantly expanded it consumer arm, buying out Switzerland-based Novartis’ (NOVN: VX) share in a consumer JV earlier this year for $13 billion.