Baxter will next year split itself into two separate and independent businesses, one that will focus on biopharmaceuticals and the other on medical products.
The move has echoes of Abbott’s recent reorganisation, which saw its research-based pharmaceuticals business spun-off as AbbVie in 2013. Last year also saw divestments from Pfizer, which separated its animal health unit, and Fresenius, which sold its biotech business.
The larger of the two proposed entities, which will comprise its $9bn medical products business, will keep the Baxter name and be led by the company’s existing chairman and CEO Robert Parkinson.
Parkinson will retain the same roles in the ‘new’ Baxter, which will focus on a broad portfolio that includes drug delivery systems, nutritional therapies and hospital-based biosurgery products.
The medical products business will also integrate Gambro, the Swedish medical technology company it acquired in 2012 for $4bn to expand its efforts in treating renal disease.
Meanwhile, the as yet unnamed biopharmaceutical side of the company, which brings in more revenues of more than $6bn – and whose sales were up 5 per cent last year – will also have diverse portfolio.
This takes in recombinant and plasma-based proteins for conditions like haemophilia and plasma-based therapies for immune deficiencies.
Ludwig Hantson, who currently serves as president, bioscience, will be chief executive officer of the new biopharmaceuticals company. His pharma background includes a stint as CEO, Pharma North America for Novartis, prior to which he spent 13 years at Johnson & Johnson.
He will be joined by Baxter board member, and MedImmune founder, Wayne Hockmeyer, who will take up the role as the new company’s non-executive chairman of the board of the new biopharmaceuticals company.
CEO and chairman Robert Parkinson said: “Baxter has an established history of executing successful spinoffs, and we have continued to evaluate the separation of these two businesses in response to diverging business dynamics and the rapidly changing macro-environment.
“This decision underscores Baxter’s commitment to ensuring its long-term strategic priorities remain aligned with shareholders’ best interests, while improving our competitive position and performance, enhancing operational, commercial and scientific effectiveness and creating value for patients, healthcare providers, and other key stakeholders.”
Baxter’s two new companies will both have their corporate headquarters in Baxter’s present home of northern Illinois. Baxter said that both entities would be “successful, profitable and sustainable” businesses once the transaction is completed, something it expects to happen by the middle of 2015.