`
`By Anita Greil
`Of DOW JONES NEWSWIRES
`476 words
`31 August 2000
`05:06
`Dow Jones International News
`DJI
`English
`
`(Copyright (c) 2000, Dow Jones & Company, Inc.)
`
`ZURICH -(Dow Jones)- Two Swiss drug companies found a cost-effective
`way to boost revenues Thursday by picking up scraps from the wedding
`feast of U.K. rivals SmithKline Beecham PLC (SBH) with Glaxo Wellcome
`PLC (GLX).
`
`SmithKline is selling the rights to antiviral drugs Famvir and
`Vectavir/Denavir to Novartis AG (NVS) for $1.63 billion in cash.
`SmithKline is also selling rights to chemotherapy drug Kytril to Roche
`AG (Z.ROC) for $1.23 billion in cash.
`
`SmithKline will also pay Roche $400 million in cash for exclusive U.S.
`rights to heart drug Coreg, currently co-marketed by the two groups in
`the U.S. and by Roche in Canada.
`
`Sales of the Kytril, Famvir and Vectavir rights are required by
`regulators for SmithKline to complete its merger with Glaxo, which is
`expected to close in late September. Glaxo already markets chemotherapy
`drug Zofran and antivirals Zovirax and Valtrex.
`
`Analysts agreed Roche's acquisition makes a lot of sense, but they
`were divided on the wisdom of Novartis' purchase.
`
`Share price reactions reflected this view.
`
`Roche was up CHF35, or 0.2%, at CHF15,675 early Thursday, while
`Novartis was down CHF12, or 0.5%, at CHF2,620. The overall market was
`0.4% lower.
`
`What is true in both cases is that "when you buy a drug that has
`already been successfully marketed there is no risk compared to big
`spending on research and development for new products," said Denise
`Anderson, analyst at Bank Sarasin.
`
`Page 1 of 2 © 2013 Factiva, Inc. All rights reserved.
`
`Helsinn Healthcare Exhibit 2043
`Dr. Reddy's Laboratories, Ltd., et al. v. Helsinn Healthcare S.A.
`Trial PGR2016-00007
`
`Page 1 of 2
`
`
`
`Roche's purchase of Kytril is in line with its strategy to focus on
`oncology products - the drug complements its already broad portfolio of
`cancer drugs.
`
`Kytril, which will lose patent protection in 2006, achieved sales of
`CHF550 million last year.
`
`"Although Kytril is already well established, Roche will probably be
`able to boost Kyrtil sales due to synergy effects," said Birgit
`Kuhlhoff, analyst at Bank Odier Lombard & Cie.
`
`Anderson agreed. She pointed out that Roche has a stronger presence
`than SmithKline in the U.S. hospital market, which should also help
`boost sales.
`
`But operating margins are lower in the hospital market than in the
`market for sales to general practitioners, which may explain why Roche
`is paying less than Novartis for a drug with higher annual revenues.
`
`The herpes drugs acquired by Novartis had combined annual sales of
`CHF351 million last year.
`
`"The drugs fit into Novartis' portfolio of immunology and infectious
`diseases and they can market them with existing sales forces," said
`Anderson.
`
`Still, that is looking at the drugs portfolio taking a very broad
`point of view, another source said, who questioned whether SmithKline's
`herpes drug really fit into Novartis' current franchise.
`
`-By Anita Greil, Dow Jones Newswires; +41 1 211 6588;
`anita.greil@dowjones.com
`
`Document dji0000020010805dw8v04a09
`
`Page 2 of 2 © 2013 Factiva, Inc. All rights reserved.
`
`Page 2 of 2
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