AstraZeneca hands European Crestor rights to old customer Grünenthal for $350M

AstraZeneca has agreed to sell European rights to Crestor to Germany's Grünenthal for up to $350 million. (AstraZeneca)

AstraZeneca has reached for the ax again, with old cholesterol blockbuster Crestor its latest target.

The British pharma has agreed to sell Crestor rights in more than 30 European countries to Grünenthal for up to $350 million, the two companies said Tuesday. The deal, expected to close in the first quarter of 2021, excludes the U.K. and Spain.

The money will mainly come in two tranches: $320 million will be paid upon transaction closing, and the German buyer may shell out an additional $30 million in milestones.

“This agreement supports the management of our mature medicines to enable reinvestment into the pipeline and bringing new, innovative treatments to patients,” Ruud Dobber, AZ’s head of biopharmaceuticals business unit, said in a statement.

Crestor is one of the most popular statin drugs out there, with annual sales that peaked at $6.62 billion in 2011. So when it fell off the patent cliff, AZ suffered years of revenue decline before CEO Pascal Soriot righted the business only two years ago.

AZ’s successful return to growth can be attributed to its increased focus on newer meds such as cancer drugs Tagrisso and Lynparza. And the company made the pivot all while distancing itself from declining therapies through divestments.

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Along the way, Grünenthal has picked up rights to several drugs unwanted by AZ. In 2018, the British pharma traded off European rights to “purple pill” Nexium and global rights to pain med Vimovo for up to $922 million from Grünenthal.

Prior to that, the German company in 2017 bought rights to AZ’s migraine treatment Zomig for all markets outside of Japan for about $302 million. In 2016, AZ offloaded rights to gout drug Zurampic in Europe and Latin America to Grünenthal for $230 million plus milestones, on the heels of selling off the drug’s U.S. rights to Ironwood Pharmaceuticals.

As for Grünenthal, those AZ deals made up all of its acquisitions since 2016, aside from one for global rights to pain drug Qutenza, which it gained separately from Astellas and Acorda Therapeutics.

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The Crestor transaction is further testament to AZ’s strategy of divesting legacy drugs to feed innovation elsewhere, even during the pandemic. About a month ago, the company agreed to sell the commercial rights to heart meds Atacand and Atacand Plus in about 70 countries—excluding the U.S., China and Japan—to Cheplapharm Arzneimittel for $400 million. Those three countries were also not included in the Crestor pact.

But that doesn’t mean those three territories were growing for Crestor. In the first three quarters, the drug hauled in sales of $884 million for AZ after a decline of 11% year over year. Of those, European sales only contributed $94 million, down 16% versus the same period in 2019.

The major drag came from emerging markets, which make up the lion’s share of Crestor’s current sales. After losing out to generics players in the Chinese government’s value-based bulk procurement scheme, Crestor sales in emerging markets fell by 7% at constant currencies to $560 million through the first nine months of the year.