AstraZeneca plcAZN signed an agreement with LEO Pharma A/S for the worldwide development and commercialization of tralokinumab for skin diseases - atopic dermatitis and any future additional dermatology indications.
AstraZeneca will get an upfront payment of $115 million from LEO Pharma and could get up to $1 billion in commercially related milestones as well as mid-teen tiered percentage royalties on product sales.
Tralokinumab has completed a phase IIb study for the treatment of patients with atopic dermatitis and is in late-stage development for patients with severe asthma. Under the terms of the deal, AstraZeneca retains all rights to tralokinumab in respiratory disease and any other non-dermatology indications.
Announces Brodalumab Deal As Well for Europe
AstraZeneca also announced that it will be terminating its licensing agreement with Valeant Pharmaceuticals International, Inc. VRX for the development and commercialization of brodalumab in Europe.
AstraZeneca has instead signed up with LEO Pharma which will get an exclusive license to brodalumab in Europe. Brodalumab is under regulatory review for patients with moderate-to-severe plaque and in development for psoriatic arthritis.
We note that AstraZeneca previously had a co-development and commercialization agreement with Amgen Inc. AMGN for brodalumab. However, Amgen had terminated that deal based on events of suicidal ideation and behavior in the brodalumab program, which Amgen felt would likely lead to restrictive labeling. Amgen will, however, continue to receive a low single-digit inventor royalty.
The deals with LEO Pharma support AstraZeneca's strategic focus on three main therapy areas: Respiratory, Inflammation and Autoimmunity, Cardiovascular and Metabolic disease and Oncology. The company said that it does not expect these agreements to impact its guidance for 2016. On its first quarter call, the company had said that it continues to expect both total revenue and core earnings to decline in the low-to-mid single-digit percentage range in 2016.
One of its key drugs, Crestor, started facing generic competition from May 2016 with Allergan plc AGN launching a generic.
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