Dive Brief:
- In its latest sell-off of unwanted assets, AstraZeneca has inked a licensing deal with China's Luye Pharma Group for the rights to Seroquel and Seroquel XR in several countries outside the U.S.
- Luye will pay $260 million upfront and another $278 million in milestone payments upon successful transition of certain activities to Luye from AstraZeneca.
- The deal will give Luye the rights to the antipsychotic in the UK, China, Brazil, Australia, Saudi Arabia, Mexico, South Korea, Thailand, Argentina, Malaysia and South Africa.
Dive Insight:
This is just the latest move by AstraZeneca to monetize assets the pharma no longer considers essential to its current growth strategy. Over the last two years, AstraZeneca has been shifting its priorities to focus more closely on oncology and liver diseases like NASH, or non-alcoholic steatohepatitis. The company's three main areas of priority now are oncology, respiratory, and cardiovascular, renal and metabolic.
"The agreement with Luye Pharma is in line with AstraZeneca’s strategy to focus on three main therapy areas while maximising the value from our legacy medicines like Seroquel," said Mark Mallon, EVP of global product and portfolio strategy at AstraZeneca, in a statement.
This latest deal adds Seroquel to the wide slate of old drugs for which AstraZeneca has sold off the foreign rights. Some of these sales have included upfront payments, while others have been structured with milestones or even royalty payments.
The one thing these deals all have in common, though, is that the British pharma is no longer bogged down by the sales and administrative functions related to the drugs.
The antipsychotic Seroquel began to lose patent protection several years ago, and has now lost it globally. While the drug was once one of AstraZeneca's best-selling products, Seroquel — and its extended release version Seroquel XR — only brought in $148 million combined in 2017 in the territories that Luye will now have the rights to.
The transaction also has other significance. The industry has seen an increasing number of deals involving companies in China, spurred by the maturation of China's life sciences sector and regulatory reforms that have opened up drug development in the country.
But this is one of the first times a Chinese company has inked a deal to gain rights to a drug beyond China or the U.S., emphasizing the move toward globalization.