AstraZeneca (NYSE:AZN) has agreed to buy a 55% stake in biotech firm Acerta Pharma for $4B, giving it access to acalabrutinib, a new kind of drug for fighting blood cancers.
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A further unconditional payment of $1.5 billion will be paid either on receipt of the first regulatory approval for acalabrutinib for any indication in the US, or the end of 2018, depending on which is first.
The agreement also includes options which, if exercised, would allow AstraZeneca to buy the rest of the privately owned firm’s shares for a further US$3bn. The closely held company is developing drugs to treat different types of cancer and autoimmune diseases, two of the drug industry’s biggest markets.
“We are excited to announce this strategic transaction with AstraZeneca, which is a testament to the value inherent in Acerta and Acalabrutinib”, Acerta CEO David Johnson said, in the statement.
Soriot hopes Acerta’s acalabrutinib could be “best in class” in the treatment of blood cancers.
The British pharma company, which rejected a takeover bid from United States giant Pfizer past year, is seeking to rebuild its portfolio as many of its key drugs are no longer under patent.
Acalabrutinib is expected to be submitted for regulatory approval in the second half of 2016.
Pascal Soriot said: “The investment is consistent with our focus on long-term growth and reflects the role targeted business development plays in our business model”.
The drug is in trials to treat B-cell blood cancers and multiple solid tumours.
Early clinical data looks promising; results from a Phase I/II study recently published in the New England Journal of Medicine showed a 95 percent response rate in patients with relapsed chronic lymphocytic leukaemia, the most prevalent form of adult leukaemia. The initial acquisition payment of $2.5 billion will be funded from cash and debt.
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The companies expect to close the deal by the end of first quarter next year, contingent upon customary closing regulations.
