AstraZeneca hands off Zurampic marketing rights to Ironwood for $100 million
- Ironwood Pharmaceuticals will pay AstraZeneca $100 million upfront for U.S. marketing rights to the British drugmaker's gout drug Zurampic, the company said on Tuesday. The deal includes up to $165 million in potential milestone payments to AstraZeneca if Zurampic hits certain sales thresholds.
- The FDA approved Zurampic in December 2015 for the treatment of hyperuricemia associated with uncontrolled gout, in combination with a xanthine oxidase inhibitor. However, the approval mandated a black box warning for the risk of acute kidney failure and the FDA is requiring post-marketing trials to further assess the drug's safety.
- AstraZeneca will continue to be responsible for the post-marketing study and will manufacture the drug for Ironwood.
Zurampic works in tandem with xanthine oxidase inhibitors (XOIs), the standard of care for treating gout. XOIs reduce uric acid production while Zurampic boosts acid secretion. Together, the drugs can help lower serum uric acid levels.
AstraZeneca acquired the drug as part of its $1.26 billion dollar deal for the biotech Ardea Biosciences in 2012. The deal with Ironwood, however, does not include other drugs in Ardea's portfolio.
Analysts have been optimistic about Zurampic's prospects, with Thomason Reuters Cortellis estimating revenues in the $350 million range. For its part, Ironwood expects peak sales to top $300 million and believes the deal will return positive cash flow by 2019.
"Our new agreement with Ironwood will ensure the successful launch of Zurampic the US, while allowing us to concentrate our resources on the innovative medicines in our main therapy areas," said Luke Miels, the head of Global Product and Portfolio Strategy at AstraZeneca.
This type of "externalization" deal is part of AstraZeneca's strategy to generate revenues by out-licensing non-core assets and focus on core therapeutic areas. Such deals also allow AZ to help offset lost revenues from patent expiries, although the revenue earned from the deals is not always viewed as highly.