AstraZeneca Keeps Pruning Drugs in $1.5 Billion Sale to Sobi
(Bloomberg) -- AstraZeneca Plc agreed to sell U.S. rights to the respiratory medicine Synagis to Sweden’s Sobi for at least $1.5 billion, another move in the U.K. drugmaker’s efforts to purge its portfolio of aging products.
Sobi, officially Swedish Orphan Biovitrum AB, also gained the right to share the U.S. profits and losses on a potential new medicine, which Astra is developing with Sanofi, that targets the same lung virus Synagis treats, the Cambridge, England-based company said in a statement.
Chief Executive Officer Pascal Soriot has been paring back Astra’s portfolio, selling the rights to fading blockbusters such as Nexium for reflux as a new crop emerges, led by Imfinzi and other cancer drugs. The goal is to become “very focused, very lean,” with a shelf full of innovative products that will keep patent exclusivity for years, Soriot said last week.
“The agreement represents good value for AstraZeneca given the size of the upfront payment,” and it allows the drug giant to focus on its core portfolio while keeping a stake in Synagis, Adam Barker, an analyst with Shore Capital Group, said in a note to clients. Synagis is projected to sell $1.3 billion cumulatively from 2019 through 2023, he said.
Sobi shares rose as much as 7.9 percent in Stockholm trading Tuesday, the most since July, while Astra was up as much as 1 percent in London.
Astra gets $1 billion in cash, which it said it plans to use for general corporate purposes, and $500 million worth of Sobi shares. About 130 Astra employee will move to Sobi as part of the transaction.
The U.K. drugmaker is also eligible for as much as $470 million in payments related to Synagis sales and a further $345 million related to development of the experimental drug. Called MEDI8897, it’s a monoclonal antibody for prevention of respiratory syncytial virus, the most prevalent cause of pneumonia and other lung infections in infants and young children.
The deal is expected to complete at the start of 2019.
©2018 Bloomberg L.P.