GSK Secures Potential ‘Multi-Blockbuster’ Drug in $950 Million 35Pharma Acquisition

Strategic Rationale: Pipeline Acceleration Under New Leadership

The acquisition reflects the strategic priorities of Luke Miels, who assumed the CEO role at GSK in January 2026 following Emma Walmsley’s departure. Miels has signaled a commitment to “smart” business development as a cornerstone of shareholder value creation, emphasizing the need for scientific courage and agility in capitalizing on emerging opportunities.[2]

The 35Pharma deal follows GSK’s $2.2 billion acquisition of Rapt Therapeutics announced in late January 2026, underscoring Miels’ intent to address longstanding investor concerns about GSK’s pipeline depth and innovation velocity.[2] This dual-acquisition strategy arrives as GSK’s stock has climbed 56% over the past 12 months, buoyed by recent clinical wins in multiple myeloma and asthma, as well as positive Phase 3 data for an experimental hepatitis treatment.[2]

The Drug: HS235 and the Activin Inhibitor Class

HS235 is a ligand trap targeting activin and growth differentiation factor (GDF) signaling pathways, mechanisms implicated in the pathophysiology of pulmonary hypertension, heart failure with preserved ejection fraction (HFpEF), and obesity.[2][13] The compound has completed Phase 1 testing in healthy volunteers and is positioned to enter Phase 2 studies in either pulmonary arterial hypertension (PAH) or pulmonary hypertension secondary to heart failure.[2]

GSK characterizes HS235 as a potentially “best-in-class” therapy with a differentiated safety and efficacy profile. The company highlights three key advantages: potential to deliver weight loss while preserving lean muscle mass, improved insulin sensitivity, and a lower bleeding risk compared to current pulmonary hypertension treatments—a critical limitation of existing therapies.[2]

The activin inhibitor class has already demonstrated commercial viability. Merck & Co.’s Winrevair, an activin signaling inhibitor approved in 2024, generated more than $1.4 billion in sales in 2025 alone, with the company actively pursuing label expansions.[2] GSK projects that activin signaling inhibitors will capture approximately half of the $18 billion pulmonary hypertension market by 2032, signaling substantial commercial potential for HS235.[2]

Market Opportunity and Competitive Landscape

Pulmonary hypertension represents a high-unmet-need indication with limited treatment options and significant mortality risk. The disease encompasses multiple etiologies, including PAH and secondary forms linked to heart failure and chronic lung disease. Current therapies—including endothelin receptor antagonists, phosphodiesterase-5 inhibitors, and soluble guanylate cyclase stimulators—carry tolerability constraints and incomplete efficacy.[2]

HS235’s potential metabolic benefits position it to address comorbidities common in pulmonary hypertension populations, particularly obesity and insulin resistance. This multi-indication potential—spanning pulmonary hypertension, HFpEF, and obesity—underpins GSK’s “multi-blockbuster” characterization of the asset.[2][9]

Competition in the activin inhibitor space remains limited but growing. Beyond Merck’s Winrevair, no other activin inhibitors have achieved regulatory approval, though several candidates remain in development across the industry. GSK’s acquisition of HS235 positions the company to compete directly with Merck in what is emerging as a high-value therapeutic class.

Financial and Operational Implications

The $950 million upfront payment reflects GSK’s confidence in HS235’s clinical and commercial potential, though the deal structure does not appear to include disclosed milestone payments or royalties.[1][5] For a Phase 1-stage asset, the valuation underscores both the strength of preclinical and early clinical data and the scarcity of validated activin inhibitor programs outside of Merck’s portfolio.

GSK’s acquisition strategy aligns with industry-wide responses to the approaching “patent cliff”—the expiration of exclusivity for blockbuster drugs worth hundreds of billions in aggregate sales. Major pharmaceutical companies are increasingly pursuing acquisitions of clinical-stage and commercial-stage biotech assets to offset revenue erosion and diversify their pipelines.[9]

The deal also reflects GSK’s capital allocation priorities under Miels’ leadership. With GSK’s stock appreciating significantly and the company generating strong cash flows, the company has expanded its share buyback program while simultaneously deploying capital toward high-conviction business development opportunities.[8]

Execution Risks and Timeline Considerations

HS235 remains in early clinical development, with Phase 2 initiation expected in the near term. Clinical and regulatory timelines for pulmonary hypertension indications typically span 4-6 years from Phase 2 initiation to potential approval, assuming positive efficacy and safety data. The compound’s multi-indication potential introduces both opportunity and complexity, as GSK will need to prioritize development pathways and design trials that support the broadest label possible while managing regulatory expectations.[2]

The metabolic benefits attributed to HS235—weight loss and improved insulin sensitivity—could position the drug for obesity indications, a market segment experiencing unprecedented commercial momentum. However, obesity development programs require large, long-duration trials and carry distinct regulatory pathways, potentially extending timelines and increasing development costs.

Broader Strategic Context

GSK’s acquisition of 35Pharma occurs within a broader industry trend of consolidation and pipeline bolstering. The pharmaceutical sector faces structural headwinds from patent expirations, pricing pressure, and the high cost of internal R&D. Strategic acquisitions of clinical-stage assets with validated mechanisms of action and early clinical proof-of-concept represent a lower-risk alternative to early-stage discovery programs.[2]

For GSK specifically, the deal signals Miels’ intent to move decisively on value-accretive opportunities while investor sentiment remains favorable. The company’s recent stock appreciation provides a window for deploying capital toward acquisitions without materially diluting shareholder value, a dynamic that may not persist indefinitely.

The 35Pharma acquisition, combined with the Rapt Therapeutics deal and recent clinical approvals, positions GSK to address investor concerns about pipeline sustainability and innovation velocity—concerns that weighed on the company’s valuation during Walmsley’s tenure. Success in executing this strategy will depend on clinical trial outcomes, regulatory navigation, and GSK’s ability to integrate and advance these assets efficiently.