US biopharma company Spectrum Pharmaceuticals has agreed to offload seven of its FDA-approved hematology/oncology drugs to Acrotech Biopharma, a subsidiary of Aurobindo Pharma USA, in a deal worth around $300 million.
The decision to sell the drugs has been taken to focus on new and innovative therapies for cancer patients, said Spectrum Pharmaceuticals.
The seven products included in the transaction are FUSILEV (levoleucovorin), FOLOTYN (pralatrexate injection), ZEVALIN (ibritumomab tiuxetan), MARQIBO (vinCRIStine sulfate LIPOSOME injection), BELEODAQ (belinostat), for injection, EVOMELA (melphalan) for injection, and KHAPZORY (levoleucovorin). These seven hematology/oncology had combined sales of $76.4 million in the first nine months of 2018.
Joe Turgeon – President, and CEO of Spectrum Pharmaceuticals said: “This divestiture marks a major strategic shift for Spectrum to ensure laser-focus on a novel, oncology drug development, and commercialization.
“The proceeds generated by the sale will significantly strengthen the financial position of the company, providing the capital to develop and commercialize our two late-stage pipeline assets, and placing us in a solid position to evaluate additional growth opportunities.”
As per the terms, Acrotech Biopharma will pay Spectrum Pharmaceuticals $160 million in cash up front and a maximum of $140 million in regulatory and sales-based milestones.
Spectrum Pharmaceuticals said that its staff size will be reduced to nearly 40% following the transaction with most of the affected employees to be transferred to Acrotech Biopharma. However, Spectrum Pharmaceuticals will retain a core group of experts to lead the launch of ROLONTIS (eflapegrastim) and poziotinib, revealed Joe Turgeon.
For Aurobindo Pharma, the acquisition is in sync with its strategy to commercialize innovative proprietary drugs. Further, it will enable the India-based Aurobindo Group to foray into the branded oncology market with a variety of drugs that are familiar with the oncology community.
Aurobindo Group said that it will also acquire a well-established and experienced branded commercial infrastructure to carry on with the commercialization of the acquired drugs.
Dr. Ashish Anvekar – President of Acrotech Biopharma said: “We are excited to jump-start our mission of helping cancer patients across the globe by delivering clinically differentiated medications and leveraging strategic partnerships. We look forward to welcome an experienced team of employees from Spectrum who are essential to our mission.”
The transaction has been approved by the boards of directors of Spectrum Pharmaceuticals as well as of Aurobindo Pharma and its closing is expected to occur within 90 days subject to receipt of regulatory approvals.
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