AstraZeneca, the UK's No2 drug maker, has agreed to pay up to $1bn (£600m) to buy a new pill that could dramatically cut the risk of heart attacks and strokes in people with clogged arteries.
The company is taking an initial $50m bet on the experimental drug being developed by a US firm, AtheroGenics, and has agreed to further payments that could total $300m as the drug is approved and another $650m if it beats ambitious sales targets.
Analysts marked AstraZeneca's shares higher yesterday, saying the drug had the potential to become a blockbuster, with sales of several billion dollars a year, and to fill a big hole in the UK company's pipeline of new medicines.
The new medicine, so far unnamed but codenamed AGI-1067, is being tested on 6,000 people deemed to have a high risk of a heart attack or a stroke. AstraZeneca will decide whether to proceed with the deal after the results of the study are unveiled around the middle of next year.
Luisa Betts, a pharmaceuticals analyst at Lehman Brothers, said she was predicting the study - the third in the three phases of trials required to gain regulatory approval - would show AGI-1067 can be a commercial success. She said: "This study is designed to show a greater than 20 per cent reduction in outcomes such as death due to coronary disease, myocardial infarction, stroke, coronary re-vascularisation and unstable angina in patients who have coronary heart disease. All patients are already getting the best standard of care in this patient population. Our AtheroGenics analyst, Jim Birchenough, believes there is a good chance of positive data after very good results in phase II."
AstraZeneca's deal with AtheroGenics is the latest in a string of licensing agreements with outside companies aimed at bolstering a pipeline of new medicines that is seen as among the weaker in the industry, particularly when it comes to products that might be ready for launch in the next three years. David Brennan, who takes over as chief executive on 1 January, has said he will step up the search for product and whole-company acquisitions to rebuild the pipeline after several disappointing drug failures since 2003.
Yesterday, John Patterson, AstraZeneca's director in charge of drug development, described the deal as a "win-win" for both companies.Reuse content