GSK plc (NYSE:GSK) has spent much of 2026 adding new drugs to its pipeline, and Berenberg is starting to think investors aren’t giving it enough credit. Berenberg analyst Kerry Holford upgraded GSK from Hold to Buy and raised the firm’s price target to 2,200p from 2,000p on September 15. Berenberg said it is “increasingly optimistic” about GSK’s growth outlook following the company’s business-development activity and pipeline momentum.
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The timing is notable, as on the same day, GSK (NYSE:GSK) announced another pipeline deal, agreeing to acquire global rights to a trispecific T-cell engager from Chimagen Biosciences for multiple myeloma in a transaction worth up to $750 million.
Bull Case
Berenberg’s upgrade rests on a broader change in how the firm views GSK’s growth prospects. Holford pointed to business development and pipeline momentum as reasons for becoming more optimistic, while also arguing that as dolutegravir “becomes progressively diluted,” GSK’s valuation discount to peers is no longer justified.
Recent moves by GSK provide some context for that view. The Chimagen agreement adds another potential oncology asset to the portfolio, and the company plans to develop and commercialize the trispecific T-cell engager for multiple myeloma, with the program expected to enter Phase I trials in 2027. The drug is designed to bind to T cells while simultaneously targeting two tumor-associated antigens.
GSK says that approach has the potential to deliver differentiated efficacy and safety compared with existing T-cell engagers. Those benefits remain prospective, however, since the program has yet to enter human trials. The deal also isn’t GSK’s first with Chimagen, as the companies previously struck an agreement for CMG1A46, a dual CD19/CD20-targeted T-cell engager that is now in Phase I development.
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More broadly, GSK completed its $10.6 billion acquisition of Nuvalent in July. That transaction added three lung-cancer assets, including zidesamtinib and neladalkib, which were under FDA review when GSK completed the acquisition. Against that backdrop, Berenberg’s upgrade gives investors another way to look at GSK’s recent dealmaking, which is that the pipeline expansion is beginning to change at least one analyst’s view of the company’s longer-term growth story.
Bear Case
There is still a considerable difference between adding pipeline assets and turning them into approved, commercially successful medicines. The latest Chimagen program is a good example, as it remains preclinical, and Phase I isn’t expected until 2027. GSK’s expectations for differentiated efficacy and safety therefore remain to be demonstrated in clinical trials.
The headline $750 million figure also requires context. GSK will pay an undisclosed upfront fee for full global rights to the program, while Chimagen is eligible for additional success-based development and commercial milestone payments. The total potential value of the agreement is up to $750 million. GSK is also committing substantial capital to business development. Its completed Nuvalent acquisition carried an aggregate equity value of approximately $10.6 billion, although GSK put its investment at about $9.4 billion after accounting for acquired cash.
Berenberg may be more optimistic about the pipeline, but GSK still has to turn those investments into clinical progress, approvals, and ultimately sales.
Conclusion
The interesting part of Berenberg’s upgrade is that it lands while GSK is actively reshaping what its future portfolio could look like. Holford’s argument is straightforward, stating that business development and pipeline momentum have improved the growth outlook, while the progressive dilution of dolutegravir makes GSK’s valuation discount to peers harder to justify. That was enough for Berenberg to move from Hold to Buy and lift its target to 2,200p.
The Chimagen deal doesn’t completely prove that thesis, as the asset is far too early in development for that. But alongside GSK’s other recent investments, it shows why the pipeline looks different today. Berenberg is becoming more optimistic about what GSK is building. The harder part for GSK will be proving that the money spent building it translates into successful medicines and durable growth.
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This article is originally published at Insider Monkey.
