SHARES in GlaxoSmithKline (GSK) fell yesterday on news that the pharmaceutical major made an approach for biotech group Genzyme.
GSK made the “causal approach” to wards the US based group over the weekend asking to be kept in mind if Genzyme intended to put itself up for sale.
Although no discussions have taken place, chief executive Andrew Witty said the group was looking to do some smaller bolt-on type acquisitions. “We may do small targeted deals, but nothing big. We will not do a large transaction in pharma nor in generics,” said Witty.
GSK declined to comment on its interest in Genzyme, which is the world’s third largest biotechnology firm and specialises in rare diseases.
But industry experts have said that Genzyme is much more likely to do a deal with Sanofi-Aventis.
The French pharma group is understood to have started “sounding out” Genzyme as it continues to look for a large acquisition. “We view Genzyme as being a credible target for Sanofi, and the magnitude of the stock price moves imply that some sort of process is indeed occurring,” said Dominic Valder at Evolution Securities.
Genzyme has appeared particularly vulnerable of late as it has been dealing with shortages of two of its biggest-selling products due to a viral contamination at its plant in Boston that led to declines in earnings and its share price.
GSK’s ended 1.3 per cent lower yesterday at 1,172p.