14th Feb 2006 07:01
GlaxoSmithKline PLC14 February 2006 Issued - 14th February 2006, London, UK GlaxoSmithKline Acquires PLIVA's Research Institute GlaxoSmithKline plc (GSK) today announces a deal in which it has reachedagreement with PLIVA d.d. (PLIVA) for the purchase of PLIVA-Istraivacki Institutd.o.o (PLIVA Research - Institute Ltd.), PLIVA's proprietary R&D arm renownedfor its research into macrolides, in Zagreb, Croatia. The closing of thetransaction is expected to occur during April 2006, subject to obtainingnecessary regulatory approvals. Under the terms of the agreement, PLIVA will receive an upfront payment of USD35m and, conditional on the entry of certain early stage projects into clinicaldevelopment, contingent payments totaling up to USD 15m, thus the totalpotential cash consideration may be up to USD 50m. In addition, PLIVA willreceive contingent royalty-based consideration pending commercialisation ofcertain assets. GSK will take on all 130 employees of the PLIVA - ResearchInstitute and will gain full ownership of the company, including allintellectual property and certain other assets such as an oncology early-stageclinical asset and pre-clinical compounds emerging from the macrolide research. Allan Baxter, Senior Vice President of Drug Discovery at GSK, said, "We aredelighted to take this opportunity to expand GSK's successful R&D model whichwill benefit from the unique capabilities of the team at the Research Institute.This Centre of Excellence will strongly complement and enhance our specificexpertise and commitment to the discovery of new chemical entities acrossseveral therapeutic areas through application of unique platform technologies." Zeljko Covic, Chief Executive Officer and President of PLIVA's Management Boardcommented, "We are pleased to have delivered upon our promise of exiting theproprietary segment in this relatively short period of time. This will allow usto now fully focus on our generics business, which we believe will delivergreater value to our shareholders. We will continue to invest strongly intogenerics research and development where we currently employ about 450 dedicatedR&D employees, whose work will remain a key success factor and foundation forthe continued growth of PLIVA's core business. We also believe that the factthat we have reached an agreement with a world class organisation such as GSK isrecognition of the knowledge and scientific expertise of the Research Instituteemployees, and that this transaction will play an important role for the futureof Croatian science." GlaxoSmithKline - one of the world's leading research-based pharmaceutical andhealthcare companies - is committed to improving the quality of human life byenabling people to do more, feel better and live longer. S M BicknellCompany Secretary14th February 2006 Cautionary statement regarding forward-looking statements Under the safe harbor provisions of the US Private Securities Litigation ReformAct of 1995, the company cautions investors that any forward-looking statementsor projections made by the company, including those made in this Announcement,are subject to risks and uncertainties that may cause actual results to differmaterially from those projected. Factors that may affect the Group's operationsare described under 'Risk Factors' in the Operating and Financial Review andProspects in the company's Annual Report on Form 20-F for 2004. Enquiries: UK Media enquiries: Philip Thomson (020) 8047 5502 David Mawdsley (020) 8047 5502 Chris Hunter-Ward (020) 8047 5502 Alice Hunt (020) 8047 5502 US Media enquiries: Nancy Pekarek (215) 751 7709 Mary Anne Rhyne (919) 483 2839 Patricia Seif (215) 751 7709 European Analyst/Investor enquiries: Duncan Learmouth (020) 8047 5540 Anita Kidgell (020) 8047 5542 Jen Hill (020) 8047 5543US Analyst/ Investor enquiries: Frank Murdolo (215) 751 7002 Tom Curry (215) 751 5419 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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