AstraZeneca Divests Two Drugs to Grünenthal in $90 Million Deal

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Privately-held Grunenthal GmbH will pay AstraZeneca $700 million for the prescription medicine rights to acid-reflux medicine Nexium. The German company also agreed to pay future milestones and sales-related payments of up to $90 million for the medication, AstraZeneca announced this morning.

U.K. pharma giant AstraZeneca announced the deal with privately-held Grunenthal today. Nexium, a proton pump inhibitor, is a well-known treatment to help reduce the amount of acid in the stomach from gastrointestinal reflux conditions and ulcers. Nexium has been approved for a number of indications, including the prevention and treatment of gastric ulcers induced by pain-relieving non-steroidal anti-inflammatory drugs (NSAIDs). Nexium has lost patent protection in a number of markets. Pfizer produces an over-the-counter Nexium in the United States. AstraZeneca will continue to commercialize Nexium in all markets outside Europe, where the company retains the rights. AstraZeneca will continue to manufacture and supply Nexium under a long-term supply agreement. Nexium generated $121 million in Europe during the first half of 2018, AstraZeneca said.

In addition to Nexium, AstraZeneca divested some rights to Vimovo (naproxen/esomeprazole) to Grünenthal an upfront payment of $115 million, Vimovo is a fixed-dose combination tablet of naproxen, a pain-relieving non-steroidal anti-inflammatory drug (NSAID) and esomeprazole. The medication is used for the symptomatic treatment of osteoarthritis, rheumatoid arthritis and ankylosing spondylitis in patients at risk of developing NSAID-associated gastric and/or duodenal ulcers. AstraZeneca kept the Vimovo rights for the United States and Japan, the company said. Vimovo garnered $37 million in revenue during the first half of the year in global sales. That figure excludes the United States and Japan.

Grünenthal Chief Executive Officer Gabriel Baertschi said the acquisition of the two AstraZeneca drugs is the largest single investment in the history of the company. He also noted that the deal is “an important step” in pursuing the company’s vision of a “world free of pain for patients.” Baertschi said there is a high unmet need for patients who are on long-term high-dose NSAIDs.

“Despite all guidelines recommending gastrointestinal protection for these patients, evidence suggests that one out of four may develop stomach ulcer with its serious health complications. Therefore, combining Grünenthal’s extensive pain expertise with the well-established products Nexium and Vimovo is a perfect strategic fit,” Baertschi said in a statement.

With this acquisition of the two drugs, Grünenthal expects to significantly enhance its business across multiple pain-related therapeutic categories and geographies, the company said.

AstraZeneca said it divested itself of the rights to those medications because they are outside of the company’s three main therapy areas of oncology, cardiovascular, renal and metabolism, and respiratory. Nexium has lost compound patent protection in the majority of global markets. Vimovo is patent protected in most European markets until 2025, AstraZeneca said.

Mark Mallon, AstraZeneca’s head of global product and portfolio strategy, said the divestment of the two medications to Grünenthal allows the company to “realize value” from its successful medicines, while “redeploying our resources on developing innovative medicines for patients across our three main therapy areas.”

“Grünenthal is a science-based pharmaceutical company specialized in innovative pain management and related therapies. Its expertise and distribution networks will help expand the commercial potential of both Nexium and Vimovo, helping to reach many patients who could benefit,” Mallon said.