ii view: GSK makes exciting food allergy acquisition
A new chief executive at the helm and ambition to increase annual sales by more than a quarter come 2031. Buy, sell, or hold?
20th January 2026 16:00
by Keith Bowman from interactive investor
Acquisition of biotech RAPT for $2.2 billion
Chief scientific officer Tony Wood said:
"The addition of ozureprubart brings another promising new, potential best-in-class treatment to GSK's pipeline."
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ii round-up:
Drug maker GSK (LSE:GSK) today looked to widen its portfolio of treatments as it announced the acquisition of California headquartered US biotech company RAPT Therapeutics for $2.2 billion (£1.6 billion).
Undergoing test trials, RAPT compounds include ozureprubart, a potentially less frequently required treatment for food allergies than is currently available. In the USA, more than 17 million people suffer from food allergies, with more than 1.3 million people suffering severe reactions.
Shares in the FTSE 100 company fell 2% in UK trading having come into this latest news up by just over a third in 2025. Nasdaq listed RAPT shares rose by 60% in US trading Tuesday. The FTSE 100 index itself rose 21.5% in 2025 and GSK rival AstraZeneca (LSE:AZN) gained by just under a third.
GSK operates across the three areas of specialty and general medicines, as well as vaccines. Food allergy conditions result in more than three million patient visits annually to hospital and emergency care.
Existing food allergy treatments require injections every two to four weeks. Most patients are children. The RAPT ozureprubart's compound offers potential for dosing every 12 weeks.
Ozureprubart also provides a new option for today’s one quarter of patients currently ineligible for existing treatments.
Data from the ongoing phase II trial assessing ozureprubart as a standalone treatment is expected in 2027. Phase III trials will be focused on both at-risk adult and paediatric populations.
Luke Miels, former commercial director, replaced Emma Walmsley as chief executive on 1 January. GSK’s annual results for 2025 are scheduled for 4 February.
ii view:
Formed in 2000 via a merger of Glaxo Welcome and SmithKline Beecham, GSK today employs over 65,000 people. Current GSK medicines include HIV treatments and vaccines to prevent respiratory conditions and shingles. Geographically, the US accounted for most sales in 2024 at 52%, followed by the rest of the world at 46%, and the UK at 2%. A constituent of the FTSE 100 index, global competitors include Merck & Co Inc (NYSE:MRK), Johnson & Johnson (NYSE:JNJ) and Pfizer Inc (NYSE:PFE).
For investors, there are no guarantees that RAPT’s food allergy treatment will receive regulatory clearance and go on to generate sales and profits. Differences between Europe and the USA could still see changes in trading tariffs have an impact. Drug development remains a risky and expensive business, while litigations for drug side effects and government investigations are now common for the pharma industry.
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More favourably, new drug development remains ongoing, with 15 formulas highlighted as offering significant sales potential as at GSK’s previous third-quarter results, and with this acquisition adding to future potential. Successful sales of higher profit margin speciality drugs also helped underpin management optimism at the Q3 results. A previous deal to partner China pharma group Hengrui in drug development is not to be forgotten, while the new chief executive is likely to try and reinvigorate group strategy via his own initiatives.
On balance, and while new blockbuster drug development is far from guaranteed, an ongoing £2 billion share buyback programme and forecast dividend yield of around 3.6% appear sufficient reward for investors to stay patient.
Positives
- Defensive qualities. Consumers need medicines even in a recession
- Artificial Intelligence or AI could favourably impact future drug development
Negatives
- Generic competition
- Currency movements can hinder
The average rating of stock market analysts:
Hold
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