Astrazeneca, the pharmaceuticals giant and one of the UK’s largest publicly-listed companies, has dropped its interest in exploring a possible merger with U.S. rival Gilead Sciencies. Gilead, based in Foster City in California, is behind the antiviral drug remdesivir, which was originally devised as an ebola treatment but has also proven to be the only effective treatment of coronavirus so far.

Reports say Astrazeneca last month made a preliminary approach to Gilead Sciences to sound out the Californian company’s position on some form of ‘combining’. However, interest has since cooled. Astrazeneca is said to have reached the conclusion that such a huge deal would be logistically extremely difficult at the moment. And that it would also prove a distraction from the company’s own pipeline of drugs.

Astrazeneca has a very promising pipeline of especially oncology drugs, which have returned the company to underlying sales growth for the first time since 2009. There were several tough years for the pharma giant after the expiration of patents for previous ‘blockbusters’. But under the successful leadership of CEO Pascal Soriot, who has been at the helm since 2012, Astrazeneca is again very much on the up.

The company is also working on a coronavirus through a partnership with the University of Oxford’s Jenner Institute and Oxford Vaccine Group. Astrazeneca is responsible for the development and worldwide manufacturing and distribution of the University’s potential vaccine known as ChAdOx1 nCoV-19.

However, doing a deal would also be extremely complicated, with Astrazeneca valued at £111 billion and NYSE-listed Gilead at $96 billion (£75.68 billion). A deal that size is always a major challenge and even more so now when logistics would be tricky as a result of lockdown rules in both the UK and USA.

Gilead’s response to Astrazeneca’s preliminary approach is also not thought to have been receptive. Despite its share price being down around a third over the past five years, it has been boosted by market hopes for remdesivir and the company is said to not currently be interested in the possibility of a merger.

The Times reports an M&A banker source who has previously worked on deals with Astrazeneca as commenting that the approach to Gilead last month had “odd timing” and was “not the most obvious deal in the world”. Both companies have declined to comment.