- AstraZeneca has sold off licensing rights to its diabetes drugs Byetta and Bydureon in China, pocketing $50 million upfront from a subsidiary of the Chinese 3SBio as it continues to shed non-core assets.
- The deal could be worth another $50 million for AstraZeneca if two milestones tied to import licenses are hit. Byetta and Bydureon are both older injectable drugs for type 2 diabetes, and combined accounted for nearly $26 million in revenue from the Chinese market over 2014 and 2015, according to 3SBio.
- AstraZeneca, stuck between a lofty revenue goal and aging blockbuster drugs, has aggressively sought to raise short-term revenue by selling off assets outsides of its core therapeutic areas. Last week, the British Pharma out-licensed four drugs, collecting nearly $800 million in near-term upfront and closing payments.
AstraZeneca keeps hanging out the “for sale” sign. While diabetes care is an expanding market in many emerging markets like China, this latest deal reflects the British pharma’s strategy of shifting toward core therapeutic areas, such as oncology and respiratory, and selling off non-core assets.
Chinese revenues for Byetta and Bydureon are growing but remained marginal over the past two years. Total sales attributable to the two drugs in China hit $11.3 million in 2014 and $14.6 million in 2015, 3SBio said.
Under the deal, AstraZeneca grants an exclusive license to Hongkong Sansheng, a wholly-owned subsidiary of 3SBio, for the commercialization of the licensed products in China. AstraZeneca still retains rights to license the products outside China along with certain rights not tied to commercialization of the licensed products in China.
Byetta was approved by Chinese regulators in August 2009, and AstraZeneca submitted an application for approval this past May for Bydureon.
AstraZeneca is under pressure to meet CEO Pascal Soriot's ambitious target of $45 billion in annual revenues by 2023. That goal is looking increasingly unattainable, especially as revenue from drugs like Crestor drops in the face of generic competition.
Yet AstraZeneca has high hopes for its efforts in oncology, and has seen promising early commercial returns from lung cancer drug Targrisso. But the real jewel is the experimental checkpoint inhibitor durvalumab, which is being tested in a range of cancers. Stiff competition could hurt AstraZeneca's chances of growing revenue in this space, however.