LONDON/NEW YORK/FRANKFURT (Reuters) - Johnson & Johnson JNJ.N has pulled out of the race to buy Pfizer's PFE.N consumer health business, leaving GlaxoSmithKline GSK.L and Reckitt Benckiser RB.L among those preparing bids, according to sources familiar with the matter.

FILE PHOTO - A Johnson & Johnson building is shown in Irvine, California, U.S., January 24, 2017. REUTERS/Mike Blake/File Photo

Bidders have until Feb. 1 to submit their non-binding offers for the unit, which makes Advil painkiller, Centrum multivitamins and Chapstick lip balm, five banking sources said.

U.S. drugmaker Pfizer, which has not made public any details about the sale process, wants to sell the business for no less than $20 billion, two of the sources added.

J&J was widely seen as one of the strongest contenders as the American healthcare giant wants to continue expanding its portfolio and has the financial muscle for a big acquisition. It initially worked with Goldman Sachs on a possible bid but subsequently decided to pull out, the sources said.

“While we would normally not comment on market speculation or rumors, in this instance we refute assertions that we are in negotiation for Pfizer’s consumer business,” J&J’s vice president of media relations Ernie Knewitz told Reuters.

Goldman was not immediately available to comment.

GSK has hired JPMorgan and Citi to work on the deal, while Reckitt has turned to Bank of America, the five sources said.

Britain’s GSK and Reckitt declined to comment, as did JPMorgan, while Citi and Bank of America were not available.

A spokeswoman for Pfizer, whose CEO Ian Read wants to focus on prescription medicines, declined to comment on the sale process, saying only that any decision on the future of the unit would be made in 2018.

The deal could be a game-changer for rival drugmaker GSK or consumer goods group Reckitt by making them one of the biggest global players in consumer health, an increasingly lucrative sector as ageing populations and health-conscious consumers drive demand for self-medication.

Although consumer remedies sold over the counter have lower margins than prescription drugs, they are typically very well known and durable brands with loyal customers.

PRICE MATTERS

The prospective sale, which is being organized by Centerview Partners, Guggenheim Securities and Morgan Stanley, was first mooted on Oct. 10, when Pfizer announced the strategic review for the unit, which had sales of about $3.4 billion in 2016.

Two of the sources said Pfizer valued the asset at more than 20 times its core earnings, or $20 billion, and was reluctant to accept less.

But J&J’s decision to steer clear leaves the drugmaker with one less big bidder, which may affect its negotiating power.

Pfizer sold its previous consumer healthcare business to J&J in 2006 for $16.6 billion and the U.S. group, with interests from baby powder to cancer drugs, had been seen as a logical buyer for the current assets.

Yet it could have faced possible antitrust problems if it beefs up its presence in the sector, said one of the sources who is familiar with the company.

Pfizer aims to clinch a deal before the summer, another source said, adding that there had been enough interest in the asset to stage a competitive auction.

A sale would confirm the consumer health sector, which is still fragmented, as fertile ground for deal-making following a spate of transactions in recent years.

Other companies that are considering making bids include Swiss consumer food giant Nestle NESN.S, said the five sources. Nestle's CEO Mark Shneider is a healthcare veteran and wants a deeper focus on nutrition, health and wellness.

Nestle declined to comment.

The firm recently sold its U.S. confectionery business to Italy's Ferrero for $2.8 billion. It is now seeking to buy Merck KGaA's MRCG.DE consumer health unit, sources have previously told Reuters, as part of its healthcare drive.

But while Pfizer’s Centrum vitamin and Caltrate calcium supplements could fit with Nestle’s new strategic direction, the U.S. firm’s Advil painkillers and Robitussin cough medicine are far removed from its core businesses like coffee, chocolate and baby food, the sources said.

A sixth source said Pfizer was likely to receive five or six bids in total. Pfizer CEO Read said on Oct. 31 that he expected no shortage of suitors for the business.

Reuters reported on Oct. 10 that established consumer health companies that may bid for Pfizer's unit include Abbott ABT.N and Procter & Gamble PG.N.