Case | HBS Case Collection | October 2012

GSK's Acquisition of Sirtris: Independence or Integration? (Abridged)

by Toby Stuart and James Weber

Abstract

An executive from pharmaceutical company GSK must choose how much to integrate a recently acquired biotechnology firm, Sirtris. Moncef Slaoui, GSK's global head of R&D, championed the acquisition of Sirtris to gain access to its potentially revolutionary science. Slaoui must balance the need to recoup shareholder value after paying a two-times premium for Sirtris with his desire to retain Christoph Westphal, Sirtris's co-founder and CEO, and other key individuals at the company. His desire to protect Sirtris from GSK's size and bureaucracy occurs in a period when GSK has launched major changes in its R&D organization, which focus on decentralizing and externalizing R&D, as well as revamping the resource allocation process to parallel more of a venture capital-based model. The case also explores the views of Christoph Westphal on the early challenges of the integration and the impact GSK was having on Sirtris. Can be used in conjunction with a separate case that focuses on Sirtris's business model.

Keywords: Mergers and Acquisitions; Resource Allocation; Organizational Change and Adaptation; Organizational Culture; Organizational Structure; Research and Development; Science-Based Business; Integration;

Citation:

Stuart, Toby, and James Weber. "GSK's Acquisition of Sirtris: Independence or Integration? (Abridged)." Harvard Business School Case 813-028, October 2012.