AstraZeneca share price: Acerta deal pays off with orphan drug status

AstraZeneca’s (LON:AZN) recent deal to acquire a majority stake in oncology specialist Acerta is starting to pay off with European regulators awarding ‘orphan’ status to the biotech group’s experimental drug acalabrutinib. Orphan status is awarded to medicines promising benefits in the treatment of rare, life-threatening diseases, with the designation providing companies with incentives such as fast-track approvals and longer periods of market exclusivity.

AstraZeneca’s share price has advanced in today’s session, having added 2.13 percent to 4,173.50p as of 13:31 GMT. The gains are part of a broader market rally which has seen the blue-chip FTSE 100 index soar 2.41 percent to 6,008.52 points so far today.
AstraZeneca announced in a statement today that the European Medicine Agency’s (EMA) Committee for Orphan Medicinal Products had adopted three positive opinions recommending acalabrutinib for designation as an orphan medicinal product. The opinions are for chronic lymphocytic leukaemia or small lymphocytic lymphoma, mantle cell lymphoma and lymphoplasmacytic lymphoma.

“Today’s three positive opinions recommending acalabrutinib for designation as an orphan medicinal product are important milestones,” Sean Bohen, chief medical officer at AstraZeneca, said in the statement, adding that they reinforced “the strategic rationale for our investment in Acerta”.
AstraZeneca inked a deal to acquire a majority stake in Acerta at the end of last year for an upfront payment of $2.5 billion, and a further payment of $1.5 billion on receipt of the first regulatory approval foracalabrutinib for any indication in the US, or the end of 2018, depending on which occurs first.
Reuters notes that the Anglo-Swedish group believes that the drug could generate sales of more than $5 billion a year, while analysts at HSBC said last month that acalabrutinib could prove to be a ‘best-in-class’ monotherapy, which justified the price for acquiring a company whose main asset had not yet been approved.
Acalabrutinib’s orphan drug status now needs to be endorsed by the European Commission which typically follows the recommendations of EMA’s committees.
As of 14:12 GMT, Thursday, 25 February, AstraZeneca plc share price is 4,172.00p.