AstraZeneca to buy U.S.-based CinCor Pharma in $1.8 bln deal


Article content

AstraZeneca said on Monday it has struck a deal to buy U.S.-based biopharmaceutical firm CinCor Pharma Inc for up to $1.8 billion to bolster its arsenal of heart and kidney drugs.

Core to the deal is CinCor’s experimental therapy baxdrostat, which is in development to treat a range of conditions including high blood pressure and chronic kidney disease.

Article content

AstraZeneca is hoping to combine baxdrostat with its own Farxiga, a diabetes drug whose sales have risen sharply after the medicine was also shown to benefit patients with heart failure as well as kidney disease.

Article content

Farxiga, whose sales jumped by almost 50% during the first nine months of 2022 to reach $3.2 billion, belongs to a highly competitive class of drugs including from Boehringer Ingelheim and Eli Lilly’s Jardiance.

About a third of AstraZeneca’s business is based on cancer drugs, but its roster of heart, kidney and diabetes drugs are its second most lucrative unit by sales.

In the first nine months of 2022, the unit generated roughly $6.9 billion of the London-listed drugmaker’s more than $33 billion in total revenue.

However, Farxiga and the oncology drugs Lynparza and Calquence could potentially face generic competition as early as 2024, BMO Capital Market analysts highlighted in a note last week, citing their own assumptions and company filings.

Article content

The Anglo-Swedish drugmaker on Monday said it had agreed to pay $26 per CinCor share in cash, or $1.3 billion in total, a premium of nearly 121% to the stock’s closing price on Friday.

The offer also includes a non-tradable contingent value right of $10 per share in cash payable upon a specified regulatory submission of baxdrostat.

Altogether, the offer represents a 206% premium to CinCor’s shares close on Friday, Astra added.

Baxdrostat in November failed to meet its main goal in a mid-stage study as it could not clearly be shown to reduce uncontrolled high blood pressure, but CinCor said it would start a larger late-stage trial during the first half of this year.

At the time, CinCor shares slumped by more than 50% on the news. The U.S. company’s shares closed at $11.78 on Friday, more than a quarter below CinCor’s initial public offering price of $16 per share in January 2022. (Reporting by Radhika Anilkumar in Bengaluru and Ludwig Burger in Frankfurt and Natalie Grover in London; editing by Susan Fenton and Jason Neely)


Source link

Comments are closed.