- Continuing with its recent sales spree, AstraZeneca plc is licensing exclusive rights to one of the big pharma's investigational treatments for lung disease to Mereo BioPharma Group plc for $5 million upfront.
- The English biotech is gaining rights to AZD9668 — an oral inhibitor of an enzyme called neutrophil elastase — and plans to push the drug into mid-stage testing as a treatment for patients with alpha-1 antitrypsin deficiency (AATD). The biotech's license also includes an option to acquire AZD9668 once pivotal studies commence.
- AstraZeneca has previously evaluated AZD9668 for several lung-focused indications, including bronchiectasis, cystic fibrosis and chronic obstructive pulmonary disease (COPD). AATD, meanwhile, is a rare condition wherein the body doesn't produce adequate amounts of a lung-protecting protein, which can lead to shortness of breath, COPD and respiratory infections.
AstraZeneca has been offloading non-core assets at a rapid clip over the past couple years, looking to divert more cash to its key therapeutic areas of cancer, cardiovascular/metabolic disease, respiratory, and inflammation and autoimmune disorders.
In early 2016, the company sold rights to its blood pressure drug Plendil and angina therapy Imdur to China Medical System Holdings for $500 million. In the roughly 18 months since then, the big drugmaker also said goodbye to ex-U.S. rights to over-the-counter nasal spray Rhinocort Aqua (budesonide) for $330 million upfront, U.S. and Canadian rights to hormone regulator Zoladex (goserelin acetate implant) for $250 million upfront, and European rights to beta-blocker Seloken (metoprolol tartrate) — amongst a slew of other assets.
The selloffs are clearly putting a good amount of capital in AstraZeneca's pockets. The company reported $5.24 billion in cash and cash equivalents as of June 30.
Yet, in spite of that added cash, AstraZeneca has had a rough go of it recently. The MYSTIC trial's failure was a major clinical setback that sent the company's shares plummeting earlier this year. While the stock has since rebounded, investors are almost certain at this point that AstraZeneca won't meet its lofty goal of generating $45 billion in revenues by 2023.
AstraZeneca will present its third quarter results on Nov. 9. The company's shares were up less than 1% to $33.72 apiece in Monday morning trading.
As for Mereo, the AstraZeneca deal further fills out the company’s rare disease pipeline and gives it another big pharma investor. Mereo is giving AstraZeneca $3 million in cash and 490,798 new ordinary shares, and is offering additional cash and equity payments related to proof of concept and pivotal study development milestones in AATD.
"AstraZeneca has generated a substantial clinical data package on AZD9668 which includes extensive Phase 2 studies in several respiratory conditions that will inform the initial Phase 2 clinical study we are planning for AATD," Mereo’s CEO Denise Scots-Knight said in an Oct. 30 statement.