- GlaxoSmithKline has agreed to sell its rights in ofatumumab for auto-immune indications, including multiple sclerosis, to Novartis Pharma for up to $1bn, plus royalties.

Novartis Pharma previously acquired the oncology indications for ofatumumab (Arzerra) as part of the major three-part transaction between GSK and Novartis that completed earlier this year.

After completion of the transaction announced today, Novartis Pharma will own rights to ofatumumab in all indications.

The consideration payable by Novartis Pharma to GSK may reach up to $1,034m and comprises a series of milestone payments as follows:

· $300 million payable at closing

· $200 million payable subject to the start of a phase III study in relapsing remitting multiple sclerosis by Novartis

· further contingent payments of up to $534 million payable on the achievement of certain other development milestones

Novartis Pharma will also pay royalties of up to 12% to GSK on any future net sales of ofatumumab in auto-immune indications. GSK chief strategy officer David Redfern said: "We are pleased to have completed this transaction to divest the remaining rights in ofatumumab, crystallising significant additional value for GSK shareholders. We continue to focus on progressing our pipeline in core therapy areas including HIV, oncology, vaccines, cardiovascular, immuno-inflammation and respiratory diseases.

"We believe GSK's pipeline has significant potential to drive long-term performance for the Group and will be profiling it further at our R&D event in November."

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