AstraZeneca buys majority stake in Acerta for $4 billion

AstraZeneca and Acerta

AstraZeneca is acquiring 55% of privately held biotech firm Acerta Pharma for $4 billion.

The deal will give the company access to a new kind of blood cancer drug, while boosting long-term growth prospects.

 

AstraZeneca believes acalabrutinib could sell more than $5 billion a year, supporting its return to growth and completing the transformation of the drugmaker’s oncology business.

“By doing a dilutive acquisition we don’t make our lives easier in the short term but we are committed to our stated goals and we will manage through,” Chief Executive Pascal Soriot said on Thursday.

Future acalabrutinib revenue would be on top of the $45 billion sales target for 2023 that was outlined last year.

If the company chooses to acquire the rest of Acerta in the future, it could come at a price tag of $7 billion all-in.

“While significant clinical and commercial risks remain, the transaction could ultimately prove a stroke of genius, adding a multibillion-dollar potential drug launch in 2017 that could accelerate AstraZeneca’s re-emergence as a major force in oncology,” Deutsche Bank analyst Richard Parkes says.

Acalabrutinib works in a similar fashion to AbbVie and Johnson & Johnson’s product Imbruvica. AstraZeneca is hoping that its product, once finalized through clinical trials, will be best-in-class, since it has fewer side effects than Imbruvica and potentially better efficacy.

AstraZeneca will pay $2.5 billion upfront, funded from cash and debt, with a further $1.5 billion paid either on receipt of the first regulatory approval for acalabrutinib or at the end of 2018.

Acerta shareholders have been given the option to sell the remaining 45% of the company for approximately $3 billion.

Acalabrutinib is expected to be submitted for regulatory approval in the second half of 2016.