AstraZeneca has agreed to acquire pharmaceutical group CinCor Pharma in a deal worth a potential $1.8bn (£1.5bn), to enhance its portfolio of heart and kidney medicines.
The biotech giant said it would spend about $1.3 billion, or $26 per share, to take over the Massachusetts-based business up front, representing a 121 percent premium to the closing share price. last Friday.
Another $10 per share will be paid to investors pending the approval of a particular regulatory filing for Baxdrostat, a treatment for blood pressure and cardiorenal condition.
Acquisition: AstraZeneca has agreed to acquire Massachusetts-based pharmaceutical group CinCor Pharma in a deal worth a potential $1.8 billion
In early November, the results of a phase two trial published in the New England Journal of Medicine showed that the drug markedly reduced high blood pressure among patients resistant to other drugs.
He accomplished this by limiting the development of aldosterone, a hormone used to regulate the body’s salt content, in a subject’s urine and blood.
However, the results of a separate study published three weeks later found that Baxdrostat did not significantly lower blood pressure when compared to placebo.
This caused CinCor’s shares to plummet by almost half in one day. They remain just over a quarter below the company’s initial public offering price of $16 per share in January 2022.
In total, London-listed AstraZeneca’s bid for CinCor is worth about 206 percent of the latter’s closing share price on Friday.
Two more Baxdrostat treatment trials are currently underway, while additional Phase III research is scheduled to begin sometime during the first half of this year.
AstraZeneca said it would eventually hope to combine the drug with Farxiga, one of its best-selling drugs and commonly used to treat type 2 diabetes and heart failure.
Mene Pangalos, the firm’s executive vice president of biopharmaceuticals research and development, said: ‘The acquisition of CinCor supports our commitment to cardiorenal disease and further strengthens our portfolio with baxdrostat.
“Excess aldosterone levels are associated with hypertension and various cardiorenal diseases, including chronic kidney disease and coronary artery disease, and being able to reduce this effectively would offer a much-needed treatment option for these patients.”
astrazeneca actions they were 1 percent lower at 11,668 pence in early trading on Monday, though their value has risen about 40 percent in the past 12 months.
The latest FTSE 100 group deal comes at the start of the JP Morgan Healthcare conference in California, the world’s largest annual gathering of the healthcare investment industry, which is being held in person for the first time in three years.
Analysts are predicting a flurry of deals in the pharmaceutical sector in 2023, given the relatively poor performance of many biotech stocks over the past year.
Victoria Scholar, chief investment officer at Interactive Investor, added that with the global economic outlook worsening, “investors are more risk averse and are looking to defensive sectors such as pharmaceuticals to weather the downturn.”
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