LONDON--AstraZeneca PLC (AZN.LN) is buying closely held U.S.
drugs company Pearl Therapeutics for up to $1.15 billion to
strengthen its respiratory drug portfolio and restock a dwindling
drugs pipeline.
The deal, announced Monday, is the latest acquisition this year
by the Anglo-Swedish drug company, and focuses on a next-generation
drug to treat chronic obstructive pulmonary disease, or COPD, an
illness primarily caused by smoking as well as by air
pollution.
Redwood City, Calif.-based Pearl Therapeutics' key drug in late
stage development, is a so-called LABA/LAMA combination drug, part
of a new class of treatment for COPD.
AstraZeneca will initially pay $560 million for Pearl and a
further $450 million if certain development and regulatory
milestones are achieved. Another $140 million could be paid if
certain sales targets are reached.
AstraZeneca Chief Executive Pascal Soriot said the acquisition
of Pearl would help the company meet a growing need. AstraZeneca
estimates 210 million people world-wide have COPD, which is
predicted to be the third biggest cause of death by 2020.
"Chronic obstructive pulmonary disease continues to increase
world-wide and there is a growing need for the next generation of
inhaled combination products," Dr. Soriot said.
According to Decision Resources, a research firm, the market for
COPD products was worth $9 billion in 2011 and is expected to be
worth $13.4 billion by 2021.
AstraZeneca already has a COPD drug called Symbicort, which
generated $3.2 billion in sales in 2012, but it is positioning
itself for the next generation of treatments. U.K. peer
GlaxoSmithKline PLC (GSK.LN) and its partner Theravance Inc. (THRX)
recently won approval from U.S. regulators to launch Breo Ellipta,
another LABA/LAMA drug.
AstraZeneca has seen its revenue and profit fall for five
consecutive quarters, mainly because of the growth of generic
competition to blockbuster drugs such as antipsychotic Seroquel and
cholesterol-lowering drug Crestor, whose patents are expiring or
have expired.
It recently agreed to acquire Omthera Pharmaceuticals (OMTH) and
AlphaCore Pharma, two cardiovascular-focused companies.
AstraZeneca said the Pearl acquisition would likely close by the
third quarter of 2013. It isn't expected to affect the company's
2013 financial guidance.
Write to Jessica Hodgson at jessica.hodgson@dowjones.com
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