In a bid to rejuvenate growth following years of shrinking revenue and the loss of patent protection for its mainstay drugs, AstraZeneca $AZN is divesting certain rights to two assets — Nexium and Vimovo — to Germany’s Grünenthal for a combined upfront of $815 million.
Under chief Pascal Soriot AstraZeneca has suffered a series of pipeline setbacks, despite some landmark successes in oncology, and the British drugmaker has committed to streamlining its arsenal of products to focus on a handful of areas: oncology, cardiovascular, renal and metabolism as well as respiratory.
Developed by AstraZeneca, Nexium is a proton pump inhibitor used to limit the acid produced by the stomach in patients with gastrointestinal reflux conditions and ulcers, and has lost compound patent protection in the majority of global markets. AstraZeneca is transferring the rights to the drug in Europe, where it generated $121 million in the first half of 2018, to Grünenthal for an upfront $700 million. The Cambridge, UK-based drugmaker is also eligible to receive sales-related and milestone payments of up to $90 million.
Vimovo is an anti-inflammatory drug comprising a fixed-dose combination of the painkiller naproxen and the active ingredient in Nexium, esomeprazole. The treatment is patent protected in most European markets until 2025. AstraZeneca is forking over the global rights, excluding the United States and Japan, to Grünenthal for an upfront payment of $115 million, and the company is eligible to get sales-related and milestone payments of up to $17 million. For the first half of 2018, Vimovo brought in $37 million in these markets.
The divestitures are expected to be consummated by the end of 2018, the companies said on Tuesday. In a similar deal inked last year, AstraZeneca handed Grünenthal the global rights, excluding Japan, to its migraine drug Zomig for an upfront $200 million.
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