Drugs giant AstraZeneca is to pay up to 6.9 billion US dollars (£5.3 billion) to Japan’s Daiichi Sankyo to develop and sell a next-generation cancer treatment.
The agreement relates to Daiichi Sankyo’s drug trastuzumab deruxtecan and will see AstraZeneca pay 1.35 billion US dollars (£1 billion) upfront, with further payments linked to sales targets.
Under the terms of the deal, the companies will jointly develop and commercialise trastuzumab deruxtecan worldwide, except in Japan where Daiichi Sankyo will maintain exclusive rights.
Daiichi Sankyo will be solely responsible for manufacturing and supply.
AstraZeneca will raise 3.5 billion US dollars (£2.7 billion) via a share placing to help bankroll the deal.
Shares in the drugmaker were down over 4% in morning trade at 6,219p.
Chief executive Pascal Soriot, who has made investment in cancer treatments a focus of his tenure, said: “We believe that trastuzumab deruxtecan could become a transformative new medicine for the treatment of HER2-positive breast and gastric cancers.
“It has the potential to redefine breast cancer treatment as the first therapy for HER2-low expressing tumours. It also has the potential to treat other HER2-mutated or HER2-overexpressing cancers, including lung and colorectal cancers.”
Trastuzumab deruxtecan delivers chemotherapy selectively to cancer cells and reduces systemic exposure, in contrast to conventional chemotherapy.
Data from an ongoing trial shows strong activity in a number of tumour types, AstraZeneca said.
George Nakayama, chairman and chief executive of Daiichi Sankyo, said: “Trastuzumab deruxtecan is the flagship asset in our oncology pipeline created by our relentless pursuit of science and technology, the most important strengths of our company.
“Through the strategic collaboration with AstraZeneca, a company with a wealth of global experience and expertise in oncology, we will combine our respective skill sets to maximise the value of trastuzumab deruxtecan and accelerate the establishment of our global oncology business.”