Pharmaceutical giant GSK Plc has announced an investment of $20 million in 23andMe Holding Co., marking an extension of their five-year collaboration. The investment grants GSK a year's access to 23andMe’s comprehensive consumer DNA data, which includes anonymized genetic information from roughly 80% of customers who have consented to share their data for research purposes. In addition to providing the data, 23andMe will also offer data analysis services to GSK.
The DNA collected by 23andMe through its testing kits, which deliver ancestral and health information to customers, is considered a crucial resource for scientific research. With a database of over 14 million customers, only Ancestry.com and the Chinese government surpass 23andMe.
GSK plans to utilize this extensive genetic data to uncover disease-related genetic pathways, with the goal of accelerating the traditionally lengthy drug development process. A significant achievement of the GSK-23andMe partnership is a potential cancer drug that targets CD96, an immune response-modulating protein. This drug reached clinical trials within four years, a substantial reduction from the industry average of seven years. The collaboration has also identified over 50 new potential drug targets.
Under the revised terms of the agreement, GSK will retain exclusive ownership of any discoveries made using the 23andMe data. However, in a departure from their previous joint venture arrangement, 23andMe is set to earn royalties on some projects.
InvestingPro Insights
In light of GSK's recent investment and partnership with 23andMe, it's beneficial to consider some key InvestingPro Tips and data. GSK, a prominent player in the pharmaceutical industry, has been profitable over the last twelve months and operates with a high return on assets, as per InvestingPro Tips. This profitability and operational efficiency may be advantageous in their partnership with 23andMe.
Analyzing InvestingPro data, GSK's market cap stands at a substantial $69.86B. The company has a P/E ratio of 9.27, indicating a potentially undervalued stock. The company's revenue growth for Q3 2023 was 2.16%, and it has a strong gross profit margin of 72.14% for the same period.
InvestingPro also highlights that GSK has maintained dividend payments for 23 consecutive years, offering a dividend yield of 3.93% as of 2023. This consistent return to shareholders may be an attractive aspect for potential investors.
For those interested in further insights and tips, InvestingPro offers a wealth of additional information, with 14 tips available specifically for GSK.
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