Pfizer to buy part of AstraZeneca's antibiotics business for £1.2bn
AstraZeneca has signed a 1.6 billion US dollar (£1.2 billion) deal to sell part of its antibiotics business to fellow pharmaceuticals giant Pfizer.
The viagra-maker is set to pay 550 US dollars (£379 million) to AstraZeneca up-front and another 175 million US dollars (£130 million) in January 2019. The remaining amount will be paid out as manufacturing and sales develop.
The deal includes the commercial and development rights to AstraZeneca's late-stage small molecule antibiotics business and "recurring, double-digit royalties" on the sale of select drugs including antibiotic Zavicefta. The rights will be valid across most global markets outside the US, AstraZeneca said.
The deal is expected to be finalised during the fourth quarter of 2016 but AstraZeneca said it will not impact the company's full-year outlook.
Luke Miels, executive vice president for Europe and head of the antibiotics business unit at AstraZeneca, said the divestment will help it focus on three main therapy areas, which include respiratory and autoimmunity therapy, cardiovascular and metabolic diseases, and oncology.
John Young, group president of Pfizer's essential health division, welcomed the acquisition, which he said would bolster the pharma giant's global portfolio.
"The addition of AstraZeneca's complementary small molecule anti-infectives portfolio will help expand patient access to these important medicines and enhance our global expertise and offerings in this increasingly important area of therapeutics, in addition to providing the opportunity for near-term revenue growth," Mr Young said.
On Monday, Pfizer said it is to acquire cancer drug company Medivation in a deal valued at about 14 billion US dollars (£10.6 billion).