GSK agrees to buy respiratory medicine specialist Aiolos Bio for $1.4bn

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GSK has struck a $1.4bn deal to acquire Anglo-American biotech Aiolos Bio, which makes respiratory medicines, as the British pharma group seeks to broaden its range of asthma products.

The acquisition will give GSK access to a treatment entering mid-stage trials, Aiolos’s AIO-001. Tony Wood, chief scientific officer at GSK, said that the asthma drug could “expand the reach of our current respiratory biologics portfolio, including to the 40 per cent of severe asthma patients . . . where treatment options are still needed”.

Aiolos launched just three months ago, after raising $245mn in financing from investors including Atlas Venture and Bain, but its treatment is ready to enter mid-stage, phase II trials, according to GSK. The group will pay $1bn upfront to acquire the San Francisco and London based biotech, with up to $400mn in milestone payments to come.

The deal comes as pharmaceutical companies gather in San Francisco for an annual industry conference this week, with GSK rivals Johnson & Johnson striking a $2bn deal to acquire an oncology biotech, and Merck and Novartis signing smaller deals on Monday.

GSK struck five deals in 2023 and chief commercial officer Luke Miels told the Financial Times in December that the company intended to do a similar amount of M&A in 2024, with a focus on bolt-on deals in respiratory and infectious diseases, such as Aiolos.

The £64bn company has long lagged behind £168bn Anglo-Swedish rival AstraZeneca, with investors raising questions over GSK’s pipeline of products and its growth plans. AIO-001 would rival AstraZeneca’s existing treatment Tezspire for asthma patients with so-called “low type-2 inflammation” but would only require dosage twice a year, compared with every month.

GSK has had recent success by beating Pfizer to market last year with the world’s first vaccine for respiratory syncytial virus (RSV), a condition affecting 64mn people worldwide.

The company hopes Arexvy, the RSV jab, could eventually reach $3bn in sales. It also has two further respiratory drugs in late-stage trials.