Drug giant GlaxoSmithKline (LON:GSK) is selling its rights to a multiple sclerosis drug to Swiss rival Novartis for up to US$1.03bn.
Glaxo said it would divest the rights in ofatumumab for auto-immune indications, including multiple sclerosis, to Novartis Pharma AG, a subsidiary of Novartis AG.
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.
Glaxo will pay the sum owing in a series of milestone payments and will also pay royalties of up to 12% on any future net sales of ofatumumab in auto-immune indications.
Glaxo's 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."
The deal is subject to regulatory conditions and is expected to complete by the end of 2015.
Glaxo said any milestone payments that it receives this year will be incremental to the company's current guidance for the year for core EPS to decline at a high teen percentage rate (CER).