(Sharecast News) - AstraZeneca has agreed to sublicense its global rights to 'Movantik', or naloxegol, excluding Europe, Canada and Israel, to RedHill Biopharma, it announced on Tuesday.
The FTSE 100 pharmaceuticals giant described Movantik as a peripherally acting mu-opioid receptor antagonist, indicated for the treatment of opioid-induced constipation.
It said RedHill would make an upfront payment of $52.5m (?40.54m) to AstraZeneca on closing, and a further non-contingent payment of $15m in 2021.
Income arising from the upfront payment, offset by a charge for derecognition of the associated intangible asset, and the future payment would be reported in AstraZeneca's financial statements within 'other operating income and expense', the company said.
In 2019, Movantik generated sales of $96m in the United States.
The divestment was expected to complete in the first quarter of 2020, subject to customary closing conditions and regulatory clearances.
On completion, the agreement would not impact the company's financial guidance for 2020, AstraZeneca said.
As part of the agreement, AstraZeneca would continue to manufacture and supply Movantik to RedHill during a transition period.
In 2015, AstraZeneca entered into a co-commercialisation agreement with Daiichi Sankyo for Movantik in the US, which would be transferred to RedHill.
"This divestment supports our strategy to realise value from medicines in our portfolio that are mature or outside our current scope to enable reinvestment in our main therapy areas," said Ruud Dobber, executive vice-president of AstraZeneca's biopharmaceuticals business unit.
"Movantik is an important established medicine and the divestment to RedHill will ensure its continued availability for patients."
Astrazeneca (AZN)Today 12:17
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