AstraZeneca announced in early January that it will purchase drug developer CinCor Pharma, Inc. for up to $1.8 billion.
CinCor has an experimental treatment for high blood pressure and chronic kidney disease currently in development. AstraZeneca plans to combine the drug, baxdrostat, with its diabetes medication Farxiga, which was shown to help patients with heart failure and kidney disease.
Baxdrostat was central to the transaction, according to Reuters.
Farxiga’s sales rose by nearly 50% during the first three quarters of 2022, reaching $3.2 billion. Its competitors include Eli Lilly’s Jardiance.
AstraZeneca’s heart, kidney, and diabetes drugs are its second most profitable category of drugs, bringing in about $6.9 billion in revenue out of the company’s $33 billion in total revenue in the first three quarters of 2022. Its cancer medicines account for about a third of revenue.
A baxdrostat-Farxiga combination could enable AstraZeneca to prolong its Farxiga franchise, according to Mene Pangalos, Executive Vice President of Biopharmaceuticals R&D at AstraZeneca.
AstraZeneca agreed to pay $26 per CinCor share in cash, or $1.3 billion in total. The offer also includes a non-tradable contingent value right of $10 per share in cash, payable upon a specified regulatory baxdrostat submission.
"Obviously, there's been a devaluation of biotech companies over the past year," said Pangalos. "I think we're very happy with what we've managed to achieve here in terms of the cost."
Before joining CinCor, Chief Executive Officer Marc de Garidel led AstraZeneca-spinoff Corvidia Therapeutics, which Novo Nordisk acquired in 2020 for $2.1 billion.
Garidel is also chairman and former CEO of French drugmaker Ipsen, which recently agreed to buy U.S. drugmaker Albireo for just under $1 billion.