GSK, Qualcomm rumored to form $1B med tech JV

GlaxoSmithKline ($GSK) and Qualcomm ($QCOM) are in talks to create a joint venture to enable GSK to expand into med tech, according to a report by Bloomberg that cites anonymous people knowledgeable of the matter. The biopharma isn't entirely unfamiliar with med tech--in fact it has a $50 million "electroceuticals" venture fund and sponsors a $5 million "bioelectronics" fund to back the development of a miniaturized, implantable, wireless, visceral nerve preclinical research platform.

The deal is said to be worth $1 billion, according to another story in the Financial Times. The notion that GSK has previously embraced is that bioelectronic devices can be used to modulate the electrical impulses involved in the body to manipulate it to reverse major illnesses that could include diabetes, asthma, hypertension, arthritis, pain and even cancer.

Action Potential Venture Capital, the venture group backed by GSK that's targeting bioelectronics, is looking for investments in neurostimulation devices, bioelectronics medicines and associated technologies such as neural interfaces and ultralow-power chips, as well as novel sensors, power sources, imaging and implantation methods. Its published portfolio includes inflammatory disease company Setpoint Medical (a Fierce 15 pick in 2013), heart failure neuromodulation company Axon Therapies and stealth bioelectronics company APVC Newco.

GSK has funded at least 33 bioelectronics R&D projects in the past few years with a focus on neural signal analysis for recording data sets; higher-resolution interfacing for the targeted disease nerves; and circuit mapping/tracing where proof of principle is achieved.

In addition, the biopharma is partnered with smart inhaler player Propeller Health--a pairing that's resulted in an FDA-approved product. On the smart inhaler front GSK isn't alone; several other biopharmas including Teva ($TEVA) have done their own smart inhaler deals. In fact, already this year another biopharma, Novartis ($NVS), partnered with Qualcomm specifically to develop smart inhalers.

Neither GSK nor Qualcomm would comment on the JV rumor. The news comes at a time that biopharma companies are turning more and more toward novel med tech, despite the massive medical device business trimming by Johnson & Johnson ($JNJ) earlier this week. Biogen ($BIIB) is in the midst of creating its own wearables and ingestibles, although it has yet to divulge much more than that on the matter. The already diversified Abbott ($ABT), for its part, went on a buying spree of startups in electrophysiology and mitral valve replacement.

Mobile player Qualcomm has been incredibly active in healthcare on all sorts of fronts over the past year or so. In September, it acquired at-home medical device connectivity company Capsule Tech and then launched it in October.

In April, Qualcomm did a deal with electronic health record company Cerner to streamline medical device data capture. That was preceded by a slew of med tech announcements last January. Qualcomm went all-out on the med tech front with a remote patient monitoring deal with Roche ($RHHBY); connected medical device deals with Walgreens and Novartis; and a whopping $100 million joint investment company with Novartis.

- here is the Bloomberg story
- and here is the Financial Times article