Zantac ruling and £800m deal lift GSK

A DOUBLE dose of positive news helped to stir GSK shares today as the drugs giant banked £800 million and welcomed a court ruling relating to heartburn drug Zantac.

The FTSE 100 stock has been in the doldrums for much of this year but ended another lacklustre week on the front foot, up 1.5% or 21.4p to 1466.2p.

The biggest boost came from British Columbia as a court dismissed a proposed class action brought against a Canadian company, saying there was no evidence that ranitidine increased the risk for any type of cancer.

The ruling was highlighted in a statement by GSK as it continues to defend itself in Canada and the United States against litigation concerning Zantac.

The cases have overshadowed the company’s attempts to convince the City of its standalone potential after the demerger of consumer healthcare business Haleon last July.

In today’s other development, GSK said it had raised £804 million by selling a 2.5% stake in the Sensodyne-to-Voltaren business at a price of 335p. GSK still holds a 10.3% stake in Haleon, alongside former partner Pfizer with a 32% holding. Both have pledged not to sell more shares in the next 60 days.

GSK’s share price improvement came during a robust session for FTSE 100 index, which rose 33.36 points to 7763.94 to end the week broadly unchanged. Banking stocks featured heavily on the risers board, with Barclays up 1.1p to 154.6p after RBC analysts upped their price target by 15p to 230p.

It was also a better session for RollsRoyce shareholders after yesterday’s AGM trading update led to a 7% fall. The stock, which is up by more 50% this year, recovered 2% or 2.6p to 148.5p in today’s session.

The FTSE 250 index fell 7.57 points to 19,258.73, although ASOS shares rose 7.4p to 507.4p at the end of a week in which its half-year results sent shares sharply lower.