GlaxoSmithKline plc has bolstered its dermatology business with a $2.9 billion purchase of Stiefel Laboratories Inc., putting together a stable of products that represent an 8 percent share of the global prescription dermatology market.

In addition to the $2.9 billion in cash, GSK will pay up to $300 million in potential milestones, and will take on more than $400 million in Stiefel debt, sending the total deal to $3.6 billion.

GSK's existing prescription dermatological products will be combined with Stiefel's, and the new specialist global business will operate under the Stiefel brand within the GSK Group.

The combination, which GSK refers to as a "new business," will have a portfolio of dermatology products that includes Stiefel's brands Duac, for acne, Olux E for dermatitis and Soriatane for severe psoriasis. GSK's key dermatology brands include Bactroban, Cutivate and recently launched Altabax.

Combined, the 2008 revenues for those products were approximately $1.5 billion, with $900 million of that coming from Stiefel. GSK also is gaining more than 15 projects Stiefel has in late-stage development for conditions such as acne, dermatoses and fungal infection.

Founded in 1847, Stiefel is the world's largest independent pharmaceutical company specializing in dermatology. In 2006 privately held Stiefel Laboratories Inc., based in Coral Gables, Fla., spent $640 million to acquire Connetics Corp., which began as a spinoff from Genentech Inc. in 1993.