Japan's Astellas Pharma gets $727M for ailing dermatology unit as it swings to new areas

Japan's Astellas Pharma sold its dermatology business to Danish specialty product firm LEO in a $727 million deal that will free up cash from a unit that analysts have long said is non-core. The deal follows a high profile move this week to splash out $379 million for U.S-based regenerative ophthalmology biotech Ocata Therapeutics.

For LEO, the deal gains it access to atopic dermatitis drug Protopic for a transaction expected to close in the first quarter next year, Astellas said in a press release. However, Astellas retains rights to the product in its home market under a distribution agreement with Maruho.

In addition to Ocata, Astellas last month paid $300 million to U.S.-based Immunomic Therapeutics for its LAMP-vax platform to treat or prevent allergic diseases, gaining exclusive global development and commercialization rights, under an option to negotiate the license under a January deal that gave it exclusive Japanese rights to ASP4070 a Phase I vaccine candidate for Japanese red cedar pollen allergies.

It also gained preclinical vaccine candidate ARA-LAMP-vax for peanut allergy. In addition to the $300 million up front, Immunomic gets 10% royalties on LAMP-vax products for allergic diseases, while retaining rights to LAMP-vax areas like cancer immunotherapy.

The sale of the dermatology business to LEO essentially covers both transactions and puts the company firmly into newer therapy areas.

"The transaction will allow us to re-allocate resources to activities that drive our competitive advantage," said Yoshihiko Hatanaka, president and CEO of Astellas, in a statement.

This is not the only dealmaking for Astellas this year. In September the firm signed a deal to in-license neuropathic pain candidate CC8464 from U.S.-biotech Chromocell for $15 million up front and the promise of up to $500 million based on development and commercial milestones in return for worldwide rights.

And in June, it joined with a Swiss biotech to create a U.S.-based firm called Kanyos Bio that will focus on autoimmune disease under a deal that could see as much as $760 million invested with an option to buy the new company outright.

- here's the release from Astellas

Read more on