Philip Morris offers £1bn to buy Vectura

Tobacco group Philip Morris International offered to buy Vectura for £1.05 billion in a bid to give the the US firm access to the British drugmaker's respiratory ailment treatments and inhaling device technology.

The move by Philip Morris International (PMI) is the latest push by big tobacco companies to change their image following years of negative press and lawsuits for marketing and selling cigarettes, a product that health advocates and experts say continues to be a leading cause of preventable deaths worldwide.

Philip Morris said in a statement that it plans to use Vectura's expertise with inhalable formulations and device design to produce a range of over-the-counter and prescription-based respiratory therapies.

The company has set a target to generate more than 50% of its revenue from smoke-free products and at least $1 billion from products beyond nicotine by 2025 as part of its "evolution into a broader healthcare and wellness company".

Vectura makes approved inhaled medicines and associated devices to treat respiratory illnesses such as asthma. Its customer base includes major international companies such as Novartis AG and GlaxoSmithKline Plc.

“PMI’s Beyond Nicotine strategy, announced in February, articulates a clear ambition to leverage our expertise in inhalation and aerosolisation into adjacent areas—including respiratory drug delivery and self-care wellness—with a goal to reach at least USD 1 billion in net revenues by 2025,” said Jacek Olczak, Chief Executive Officer.

“The acquisition of Vectura, following the recently announced agreement to acquire Fertin Pharma, will position us to accelerate this journey by expanding our capabilities in innovative inhaled and oral product formulations in order to deliver long-term growth and returns.”

“The market for inhaled therapeutics is large and growing rapidly, with significant potential for expansion into new application areas. PMI has the commitment to science and the financial resources to empower Vectura’s skilled team to execute on an ambitious long-term vision. Together, PMI and Vectura can lead this global category, bringing benefits to patients, to consumers, to public health, and to society-at-large.”

PMI believes that, together, the companies can create a fully-owned pipeline of products across a broad range of sectors in the prescription drug and over-the-counter (OTC) categories that will complement Vectura’s CDMO business and service to its existing client base.

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