Summary
GSK's latest deal on Duchenne's muscular dystrophy with the Dutch company Prosena is a further indication of the former's interest in diversifying out of the more obvious, major areas of medicine.
This can make sense: such "esoteric" indications areas are less well understood, there is less competition and commercial rewards can turn out to be greater than superficially apparent.
Analysis
Over the past few years GSK has been one of a few major pharma companies to diverge from the conventional wisdom of strict focus, and start dabbling in less than major areas. It had done deals in smaller or developing countries and got into generics through several deals.
Also GSK has been venturing into apparently smaller indications. It is building up its position for example in esoteric indications such as pulmonary arterial hypertension (PAH), lupus and now Duchenne's muscular dystrophy. Small esoteric indications, where there is usually considerable scope for meeting unmet need, often turn out to be bigger areas commercially than superficial assessments suggest. There is also less competition and price sensitivity. Sometimes adjacent indications emerge which can also turn out to be treatable with the same drug, or the company can apply scientific or clinical expertise it has gained to other areas.
This particular avenue, of diversification into esoteric indications, is in my view much more likely to prove commercially rewarding for GSK than the others mentioned above.
John Ansell consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
