The UK's biggest pharmaceutical company Glaxo Smith Kline (GSK) has announced a $3.6 billion (£2.5 million) deal to buy US skincare company Stiefel.
Andrew Witty, GSK's chief executive officer, said: "This transaction will create a new world-leading, specialist dermatology business and re-energise our existing dermatology products.
"The addition of Stiefels broad portfolio will provide immediate new revenue flows to GSK with significant opportunities to enhance growth through leveraging our existing global commercial infrastructure and manufacturing capability.
"We look forward to working with Stiefel to develop this exciting opportunity."
Steifel specialises in treatments for acne and psoriasis. Its sales were $900 million last year, which combined with GSK's $550 million will give the new business an eight per cent share of the prescription skincare market.
When the deal is completed later this year, the new company will be led by Charles Stiefel, current head of the US company.
The deal comes just days after GSK announced an agreement with New York based pharmaceutical company Pfizer to merge the two companies' HIV drug businesses. The new company will have a 20 per cent share of the market providing vital drugs to HIV sufferers.