Ambitious Aralez adds AstraZeneca’s Toprol to its expanding CV portfolio

Aralez hasn't wasted time on its rebirth as a cardiovascular specialty pharma. A $175 million-plus agreement to buy AstraZeneca's Toprol-XL franchise came hard on the heels of a deal for Merck & Co.'s clot-busting Zontivity--and the launch of its long-awaited aspirin combo pill Yosprala.

The trio of drugs are now Aralez' to market, with a sales force of 110 reps that might just expand when the company relaunches Zontivity next year.

Aralez will shell out $175 million up front for the U.S. rights to AstraZeneca's branded beta blocker and an authorized generic version now marketed by Par Pharmaceuticals. AstraZeneca is up for $48 million in sales-related milestones, and mid-teen-percentage royalties on sales.

Also part of the deal is a 10-year supply agreement, under which AstraZeneca continues to manufacture the med for Aralez to sell.

Toprol-XL has been on the U.S. market for more than two decades, so it faces plenty of generic competition. But it's still delivering a stream of revenue--not much for a Big Pharma like AstraZeneca, but a nice chunk of change for Aralez. Known generically as metoprolol, the drug is used to control high blood pressure, and to treat chest pain and heart failure. Last year, Toprol and its authorized copy brought in $89 million, and it contributed $53 million to AstraZeneca's coffers in the first half of 2016.

Canada-based Aralez has not set any new revenue projections, but CEO Adrian Adams called Toprol XL a substantial U.S. product that's a strong addition to Aralez' up-and-coming CV stable. The product will also add “immediate and significant revenue” to the company, Adams said during a conference call about the acquisition.

Par will continue to market the generic version, and Aralez will collect a percentage of those profits. The deal is expected to close by the end of this year.

In the past few weeks, Aralez has been busy with moves to grow its CV business, which it sees as a core focus for the company. Just one day before the AstraZeneca deal, the Canada-based pharma launched its aspirin-omeprazole combo drug, Yosprala, approved by the FDA in mid-September. The company assigned those 110 sales reps to promote the new drug alongside its other CV med Fibricor--and presumably, they'll soon promote Toprol as well.

In September, Aralez snapped up Merck & Co.'s abandoned clot-fighting drug Zontivity in a $25 million deal, with plans to relaunch it in 2017. The company hasn't said whether it'll add to its salesforce to help support that launch. Unlike Toprol, Zontivity is still on patent, and thus might be able to eclipse the older med--but then again, Merck had its own troubles getting Zontivity off the ground, so it remains to be seen whether Aralez can achieve a different result.

All this action has been fueled by an investment deal with Deerfield Management, which ponied up $300 million in debt and equity to support Aralez as it emerged from the combo of Pozen Pharma and Tribute Pharmaceuticals.

Expect more to come: Along with its deal for Toprol, Aralez announced an additional $250 million commitment from Deerfield to fund future acquisitions. Have a non-core CV drug to unload? They might be the folks to call.

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