Health Secretary Sajid Javid has been urged to block the £1bn takeover of specialist inhaler firm Vectura by tobacco giant Philip Morris International (PMI).
Directors at Vectura, which has its roots in a spin-out from the University of Bath, last night recommended the Marlboro cigarette maker’s offer, unleashing a storm of protest from dozens of healthcare charities and public health bodies, including Asthma UK and the British Lung Foundation.
In the letter, the organisations said PMI “could profit from treating the very illnesses that its products cause” if the takeover went ahead.
Shadow health secretary Jonathan Ashworth joined the protests, saying PMI’s attempted takeover of a key player in lung health products beggared belief.
He added: “It is bitterly disappointing that Vectura have so far failed to exercise duty of care to patients and scientists and reject this takeover by big tobacco.
“This is now a test for Sajid Javid. When we know smoking causes so much serious illness and premature death, it’s time this government takes the right course, stands up to this tobacco giant and blocks this takeover.”
PMI’s offer of just over £1bn outbid an earlier £958m approach from global private equity giant Carlyle, which had initially been backed by Chippenham-based Vectura’s board. Carlyle has said it will not make counter offer.
Philip Morris International is investing billions of pounds to move away from its core tobacco business – it recently said it could stop selling cigarettes in the UK within 10 years as it focuses on alternatives.
These include nicotine gum after it acquired Danish producer Fertin Pharma for $820m and heated tobacco. It has spent at least $8bn on smoking alternatives such as its IQOS devices, which were launched in the UK two years ago.
Chief executive officer Jacek Olczak has said the group is targeting at least $1bn in non-nicotine sales by 2025.
Vectura’s board described PMI’s offer as “fair and reasonable” and said they would now recommend it to the firm’s shareholders.
The board said: “The Vectura directors recognise the superior cash price the final PMI offer provides Vectura shareholders.
"The Vectura directors also note that wider stakeholders could benefit from PMI’s significant financial resources and its intentions to increase research and development investment and to operate Vectura as an autonomous business unit that will form the backbone of its inhaled therapeutics business.”
Founded in 1997, Vectura has grown strongly by developing inhalable dry-powder drugs that treat lung conditions such as asthma, emphysema and chronic bronchitis.
Its pioneering approach led to new ways of treating asthma and lung diseases and it earned strong revenues from collaborations and licence agreements with global pharmaceutical and biotechnology companies such as Novartis, Sandoz and GlaxoSmithKline.
In 2016 it merged with London-based Skyepharma, creating one of the UK’s leading specialist pharmaceutical firms with a combined turnover of £1bn.
