GlaxoSmithKline (GSK) announced on Monday that it will partner with venture capitalists Avalon Ventures in a $495m deal that will enable it to fund up to 10 drug discovery start up companies over the next three years.
UK-based pharmaceutical giant GSK will provide technical and financial support to start-ups established by Avalon Ventures on the basis that it will have first rights on buying each new company, reported Reuters.
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As part of the deal, Avalon will provide $30m and GSK will provide up to $495m.
GSK spokeswoman Melinda Stubbee told Reuters that each startup would have just a few employees and will focus on a single compound to develop for conditions ranging from cancer to infectious diseases.
A day after GSK’s announcement ratings agency Moody’s said cash-rich drug companies are expected to make more acquisitions in 2013 after a slow year in 2012.
The ratings agency said pharma giants such as Roche, Pfizer and Novartis could start looking for new acquisitions after they deleveraged after big deals three or four years ago. AstraZeneca is also said to be looking for deals to strengthen its pipeline.
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By GlobalDataPhoto: GSK are looking to fund 10 startup companies in three years as part of the partnership. Image: Courtesy of GSK.
