Aspen Pharmacare to buy AstraZeneca's anaesthetics portfolio for at least $520 mn

South Africa's Aspen Pharmacare Holdings Ltd today struck a deal to buy British drug giant AstraZeneca Plc's anaesthetics portfolio worldwide except the US for at least $520 million.

The deal comes a day after Aspen secured €3 billion ($3.4 billion) in funding from 27 banks.

Aspen's subsidiary, Aspen Global Incorporated (AGI), will acquire exclusive rights to sell AstraZeneca's seven established medicines outside the US - Diprivan for general anaesthesia, EMLA, a topical anaesthetic, and five local anaesthetics - Xylocaine / Xylocard / Xyloproct, Marcaine, Carbocaine and Citanest.

The US rights to these medicines were divested to Abraxis, now part of Fresenius Kabi, in 2006.

These products are sold in more than 100 countries, including China, Japan, Australia and Brazil.

Under the terms of the agreement, AGI will make an upfront payment of $520 million and also pay AstraZeneca up to $250 million in a product sales-related payment over the next two years, as well as double-digit percentage trademark royalties on product sales.

AstraZeneca will manufacture and supply the products on a cost plus basis to AGI for an initial period of 10 years.

The portfolio generated sales of $592 million last year.

''AstraZeneca has a rich heritage in anaesthetic medicines and this agreement will extend the reach of our established portfolio to a greater number of patients through AGI's extensive commercial network. This agreement supports our strategic focus on the new medicines in three main therapy areas,'' said, Pascal Soriot, CEO of AstraZeneca.

''This is a strategically-important investment for AGI and it is pleasing to have a company such as AstraZeneca recognise Aspen's commercial competencies. This transaction is an excellent opportunity to build on the quality brands commercialised through AGI, working alongside an acknowledged pioneer and leader in the field of anaesthetics,'' said, Stephen Saad, CEO of Aspen.