AstraZeneca $AZN has divested the US rights to its preventative RSV drug, Synagis, to Swedish Orphan Biovitrum AB (Sobi) for $1.5 billion in cash and stock, as the British drugmaker continues to refine its pipeline and focus on its newer flagship products.
Synagis, known chemically as palivizumab, is used to prevent serious lower respiratory tract infections caused by the respiratory syncytial virus (RSV) in infants and young children, and is the only medicine approved for the prevention of serious RSV disease. US sales of the drug declined by 27% to $133 million in Q3, AstraZeneca reported last week. Sales of the drug outside the US, which is the responsibility of AbbVie $ABBV, were up 4% to $281 million.
Despite some pipeline setbacks, AstraZeneca has enjoyed some some landmark successes in oncology under chief Pascal Soriot, following years of shrinking revenue and growing generic competition eating into sales of the company’s mainstay products. Soriot’s approach, characterised by new drug approvals and asset sales, is focused on the principle that the company must simplify its approach, concentrating on blockbuster, standard-of-care assets that can make a major difference. This strategy has changed the company’s trajectory — last week AstraZeneca reported a significant spurt in Q3 sales, driven by new product development and success in the growing China drug market.
As part of the transaction, Sobi will commercialize Synagis in the US and roughly 130 AstraZeneca employees will be transferred to the Swedish drugmaker. Sobi will also have the right to participate in AstraZeneca’s share of US profits and losses related to potential new medicine MEDI8897, a monoclonal antibody that neutralizes RSV and has been engineered to have a long half-life, so that only one dose will be needed for the entire RSV season.
AstraZeneca will continue to develop MEDI8897 in collaboration with France’s Sanofi $SNY, the British drugmaker added on Tuesday.
The deal consists of $1 billion in cash and $500 million in ordinary Sobi shares upon completion,