Grünenthal has agreed to acquire AstraZeneca’s European rights to Nexium®(esomeprazole) and the pharma giant’s rights to Vimovo® (naproxen/esomeprazole) worldwide except the U.S. and Japan for up to $922 million, the companies said today.

The deal reflects both Grünenthal’s intent to expand its pain therapeutics business across multiple categories and territories worldwide—and AstraZeneca’s ongoing streamlining of its drug pipeline.

Vimovo® (naproxen/esomeprazole)

Vimovo® (naproxen/esomeprazole)

“This acquisition is the biggest single investment in Grünenthal’s history and an important step in pursuing our vision of creating a world free of pain for patients,” Grünenthal CEO Gabriel Baertschi said in a statement.

Nexium is a proton pump inhibitor that reduces stomach acid in patients with gastroesophageal reflux conditions and ulcers. Its approved indications include the prevention and treatment of gastric ulcers induced by pain-relieving non-steroidal anti-inflammatory drugs (NSAIDs).

Grünenthal agreed to acquire Nexium rights in 33 European nations for $700 million upfront, and up to $90 million in payments tied to achieving sales and other milestones, AstraZeneca disclosed.

During the first half of this year, Europe accounted for 13.6% ($121 million) of Nexium’s $890 million in worldwide sales, and 12.7% ($248 million) of the $1.952 billion in worldwide sales reported last year.

Vimovo is a fixed-dose combination tablet of naproxen, a pain-relieving non-steroidal anti-inflammatory drug (NSAID) and esomeprazole, the same gastroprotective active ingredient as in Nexium. It is indicated for the symptomatic treatment of osteoarthritis, rheumatoid arthritis and ankylosing spondylitis in patients at risk of developing NSAID-associated gastric and/or duodenal ulcers.

Vimovo sales are not broken out by AstraZeneca in its quarterly earnings announcements. The company said today that Vimovo sales worldwide except the U.S. and Japan were $37 million during the first half of this year, while Grünenthal said those sales were $79 million last year.

Grünenthal agreed to buy ex-U.S. and Japan rights to Vimovo for $115 million upfront and up to $17 million in future milestones and sales-related payments, AstraZeneca disclosed.

AstraZeneca sold U.S. rights to Vimovo to Horizon Pharma in 2013 for $40 million through 2014 and $7.5 million each year afterward.

‘Redeploying Our Resources’

AstraZeneca said it was selling the rights because the drugs fall outside its main therapy areas

of oncology, cardiovascular, renal & metabolism, and respiratory.

“The divestment agreements allow us to realize value from our successful medicines while redeploying our resources on developing innovative medicines for patients across our three main therapy areas, which we expect to drive growth for AstraZeneca,” stated Mark Mallon, AstraZeneca EVP, Global Product & Portfolio Strategy.

AstraZeneca has shed treatments and pipeline candidates in other indications through a series of deals in recent years. This year, those deals included its $250 million Viela Bio spinoff in February of six inflammation- and autoimmunity-focused drug candidates of its MedImmune subsidiary; and its sell-off in May of rights in some nations outside the U.S. to the antipsychotic drug Seroquel® and its extended-release tablet form Seroquel XR® (quetiapine fumarate) to Luye Pharma Group for up to $538 million.

Another reason cited by AstraZeneca for the sale was the drugs’ loss of exclusivity: Nexium has lost compound patent protection in most global markets, while Vimovo is patent-protected in most European markets until 2025.

The deal is expected to close by year’s end. Grünenthal said it has secured financing for the deal through underwriting banks BBVA, BNP Paribas, Commerzbank, and ING.

Upon completion of the deal, AstraZeneca will not retain any ownership rights to Vimovo globally, or to Nexium in Europe—though AstraZeneca said it will continue to continue to commercialize Nexium in all markets outside Europe where the company retains the rights, and will manufacture and supply Nexium under a long-term supply agreement.

Last year, Grünenthal acquired from AstraZeneca ex-Japan global rights to the migraine treatment Zomig (zolmitriptan)  for $200 million upfront and up to an additional $102 million in potential milestone payments.

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