AstraZeneca has agreed to offload the US rights of its respiratory drug Synagis (palivizumab) to Swedish Orphan Biovitrum (Sobi) in a cash-cum-stock deal worth $1.5bn.
Synagis is indicated for the prevention of serious lower respiratory tract infection (LRTI) caused by respiratory syncytial virus (RSV) in highly prone infants and is the only approved preventative drug for the condition as of now.
Under the terms of the deal, AstraZeneca will be paid $1.0bn in cash and $500m worth shares of Sobi upon closing.
Sobi will get the rights to commercialize Synagis in the US and will also take in nearly 130 AstraZeneca employees as part of the deal.
The Swedish pharma company will also have the right to take part in AstraZeneca’s share of US profits and losses associated with a potential new medicine, dubbed MEDI8897, which is being developed in collaboration with Sanofi Pasteur.
MEDI8897 is a single dose extended half-life anti-RSV F mAb. It is being developed for the prevention of LRTI caused by RSV in all infants entering their first RSV season and children suffering from chronic lung disease or congenital heart disease entering their first and second RSV season.
AstraZeneca CEO Pascal Soriot said: “We continue to streamline our portfolio, allowing AstraZeneca to allocate resources more effectively, while Sobi’s focus on Synagis will enable infants in the US to continue benefiting from this important treatment. Meanwhile, the successful development and commercialisation of MEDI8897 remains important for AstraZeneca.”
In addition to the $1.5bn upfront consideration for the US rights of Synagis, AstraZeneca will also be paid up to $470m in sales-related payments for the respiratory drug.
Further, the UK pharma major will also be eligible for a $175m milestone payment after the submission of the Biologics License Application for MEDI8897 along with potential net payments of around $110m on achievement of other profit and development-related milestones of the new drug and a total of $60m in non-contingent payments during 2019-2021.
Sobi president and CEO Guido Oelkers said: “The addition of Synagis will become an important strategic catalyst for Sobi’s future development and will form a powerful platform for growth in rare diseases.
“We see the acquisition as a stepping stone to drive sustainable growth in the US and make Sobi more attractive for partnering. It also increases the overall Specialty Care franchise and diversifies our portfolio in Immunology.”
Closing of the deal is anticipated to occur by the end of 2018 or early 2019, based on meeting of certain customary conditions and receipt of regulatory approvals.