GlaxoSmithKline and Novartis sign $25 billion worth of drug deals

Two of the world's biggest drugmakers, Britain's GlaxoSmithKline and Switzerland's Novartis, announced a complex hodgepodge of deals worth at least $25 billion on Tuesday. The main components:

* Novartis agreed to buy Glaxo's oncology business for between $14.5 billion and $16 billion* Glaxo is buying Novartis' vaccine business for between $5.3 billion and $7.1 billion* The two companies are combining their consumer health (over-the-counter) divisions, with Glaxo taking 63.5 percent of the joint venture* Eli Lilly will purchase Novartis' animal health unit for about $5.4 billion

The transactions will let Novartis focus on high-margin businesses like cancer drugs while Glaxo boosts its position in consumer goods and the low-margin, high-volume vaccine market. But the pharmaceutical giants aren't the only drugmakers making high-stakes deals. The Wall Street Journal says the $25 billion worth of transactions cap a 24-hour period where "deals worth, conservatively, $65 billion" were announced, not counting Pfizer's unsolicited $101 billion offer to buy Britain's AstraZeneca.

"The Novartis-Glaxo deal and rumors about a potential AstraZeneca acquisition by Pfizer are giving the pharma sector a decent run this morning," Danish strategist Witold Bahrke tells Bloomberg News. "It's also fueling further M&A expectations."

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Peter has worked as a news and culture writer and editor at The Week since the site's launch in 2008. He covers politics, world affairs, religion and cultural currents. His journalism career began as a copy editor at a financial newswire and has included editorial positions at The New York Times Magazine, Facts on File, and Oregon State University.