AstraZeneca, plc (AZN - Free Report) announced that it has entered into an agreement to dispose theremaining rights to its anaesthetics medicines, to Aspen Global Incorporated (AGI), the Mauritian subsidiary of the Aspen Group, for an upfront consideration of $555 million.
We remind investors that AstraZeneca had divested the commercialization rights to its anaesthetic medicines outside the U.S. markets to AGI, per a collaboration agreement signed in June 2016.
With the new deal, AGI will acquire remaining rights to the intellectual property and manufacturing know-how related to AstraZeneca’s anaesthetic medicines comprising of Diprivan, EMLA, Xylocaine/Xylocard/Xyloproct, Marcaine, Naropin, Carbocaine and Citanest.
Meanwhile, AstraZeneca will continue to manufacture and supply the medicines to AGI for the next five years. Also, the company will be entitled to sales-based milestone payments of up to $211 million from Sep 1, 2017 to Nov 30, 2019. However, under the new agreement, AGI will not pay any royalties to AstraZeneca, which was a condition in the older agreement.
Notably, the new deal is expected to close in the fourth quarter of 2017.
So far this year, AstraZeneca’s shares have gained 19.5%, comparing favorably with the industry’s growth of 16%.
AstraZeneca has been regularly divesting non-core assets or marketing rights to some treatments so that it can focus its resources on three main therapy areas including oncology and respiratory.
In June 2017, the company sold the global rights of migraine treatment drug Zomig outside Japan to Grünenthal, a German pharmaceutical company.
In March, it sold the U.S. commercialization rights to its inhaled respiratory medicines — Tudorza and Duaklir — for COPD to Circassia Pharmaceuticals. Also, it entered into a deal with Sanofi’s (SNY) vaccines unit Sanofi Pasteur for the development and commercialization of MEDI8897 for the prevention of respiratory syncytial virus (RSV) associated illness in newborns and infants in the same month.
Again, in February, it entered into an agreement with TerSera Therapeutics selling commercial rights to Zoladex in the United States and Canada.
Last year, AstraZeneca divested the outside U.S. rights to Rhinocort Aqua, a nasal spray indicated for allergic and non-allergic rhinitis to an affiliate of Johnson & Johnson (JNJ - Free Report) , the global rights to develop and commercialize its experimental Crohn's disease drug – MEDI2070 to Allergan plc (AGN - Free Report) , and the U.S. rights to the branded as well as authorized generic verison of its beta-blocker heart medicine — Toprol-XL — to Aralez Pharmaceuticals, Inc. .
AstraZeneca currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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