GlaxoSmithKline buys Vancouver's ID Biomedical for $1.7 billion

British pharmaceutical giant GlaxoSmithKline PLC announced Wednesday that it is buying ID Biomedical Corp. for $1.7 billion.

ID Biomedical is a vaccine company based in Vancouver. It will become a wholly owned subsidiary of GSK.

GlaxoSmithKline will pay $35 per share, a 13 per cent premium over its Tuesday closing share price.

The London-based company will also assume $77 million US of ID Biomedical's debt.

"GSK's proposed acquisition of ID Biomedical reflects its continuing commitment to address the public health need for increased supply of influenza vaccines," GlaxoSmithKline said in a release.

"ID Biomedical is currently in the process of expanding and upgrading its Canadian manufacturing facilities, which are expected, beginning in 2007, to produce around 75 million doses per year of ID Biomedical's Fluviral egg-based influenza vaccine."

The transaction is expected to close by the end of 2005 or early 2006.