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AstraZeneca sets sights on China with Takeda deal

Buys the Japanese firm's respiratory drugs to extends their ongoing biologics R&D collaboration

ChinaAstraZeneca's corporate shake-up continues apace, with a strategic alliance designed to raise its presence in China and an agreement to buy Takeda's respiratory portfolio.

The deal with Chinese contract research and manufacturing firm WuXi AppTec extends an ongoing biologics R&D collaboration between the two companies focused on inflammatory bowel disease candidate MEDI5117, and includes an option to buy a biomanufacturing facility in Wuxi City for around $100m.

AZ and WuXi have been collaborating on MEDi5117 - a fully human interleukin-6 (IL-6) targeting monoclonal antibody that is also being tested in rheumatoid arthritis - since 2012.

AZ also said it plans to spend $50m on the construction of a new manufacturing facility for small-molecule drugs alongside its existing plant in Wuxi City, as well as a new 'hub' for pharma R&D with up to 50 scientists based in Shanghai and Wuxi City. The unit will sit alongside AZ's other hubs in the UK and Sweden.

The company's executive vice president, international - Mark Mallon - said the increased investment "reinforces our commitment to bring innovative medicines from our exciting pipeline of targeted and biological medicines to patients in China faster and supports our continued strong growth in the country."

AZ's business in China has been enjoying double-digit growth, though latterly at a slightly lower rate, thanks to strong underlying dynamics in the market.

Respiratory deal

Meanwhile, AZ has agreed a deal with Takeda to buy its respiratory drug franchise - including rights to oral PDE4 inhibitor Daliresp/Daxas (roflumilast), inhaled corticosteroid Alvesco/Omnaris (ciclesonide) and various pipeline candidates - for $575m. The UK-based pharma major already has rights to Daliresp in the US.

The marketed drugs brought in sales of 24 billion yen ($198m) in the year ending March 2015, and AZ said the deal will be accretive to earnings from 2016. Around 200 Takeda employees will transfer to AZ when the agreement completes. 

AZ's respiratory franchise is currently headed by asthma and chronic obstructive pulmonary disease (COPD) drug Symbicort (budesonide and formoterol), which made $2.5bn in the first nine months of the year but has started to shrink as it feels the effects of competition in mature markets.

The two deals come amid a flurry of M&A activity at AZ, which confirmed it is in negotiations to buy Acerta Pharma earlier this week and snapped up ZS Pharma in a $2.7bn last month. 

The company also recently sold off US rights to gastroenterology drug Entocort (budesonide) to Perrigo for $380m, saying the product lay outside its strategic focus.

Article by
Phil Taylor

16th December 2015

From: Sales

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