UK drug maker Vectura is buying fellow biotechnology firm Skyepharma in a deal worth around £441 million ($637 million). The merger will create an industry leading specialist in inhalation devices for patients with respiratory diseases.

Their respective product portfolios and areas of expertise, which include dry powder inhalers, pressurized metered dose inhalers and nebulisers for people with airways-related illnesses such as asthma and chronic obstructive pulmonary disease (COPD), are complementary.

“Combining the two groups will create a stronger scaled business which has the ability to accelerate the delivery of both companies’ strategic objectives and deliver greater revenues, providing broad access to the global inhaled respiratory market which was worth $35 billion in 2015”, the companies said.

The enlarged entity would have a market capitalization of more than £1 billion, with revenue of £153.9 million and annual EBITDA of £50.5 million.

Vectura said it has identified potential annual pre-tax synergies of around £10 million which would be fully realized by 2018. Earnings are expected to be accretive in the first year.

James Ward-Lilly, CEO of Vectura, will take the same role at the combined group; Skyepharma’s CEO, Peter Grant, will leave the company.