AstraZeneca (LON:AZN) has moved to amend a deal with Ironwood to take control of Linzess in China, the Anglo-Swedish drugmaker has said. The move comes after the two companies first entered into a collaboration to co-develop and co-commercialise the treatment in 2012.
AstraZeneca’s share price has climbed higher in London this morning, having gained 0.46 percent to 6,923.00p as of 10:04 BST. The stock is outperforming the broader UK market, with the benchmark FTSE 100 index currently standing 0.17 percent higher at 7,332.65 points. The group’s shares have added more than 23 percent to their value over the past year, as compared with about a 0.5-percent rise in the Footsie.
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Amended Ironwood deal
AstraZeneca announced in a statement this morning that it had amended its collaboration deal with Ironwood in China mainland, China Hong Kong and China Macau for linaclotide in mainland China, Hong Kong and Macau. Linaclotide, marketed as Linzess, is a new treatment for patients with irritable bowel syndrome with constipation, a condition characterised by symptoms of abdominal pain and constipation which is a chronic and prevalent functional gastrointestinal disorder in China.
Under the new terms of the deal, AstraZeneca will have sole responsibility for developing, manufacturing and commercialising the treatment. The Anglo-Swedish group will pay Ironwood three non-contingent payments, totalling $35m, between 2021 and 2024, along with up to $90m in milestone payments, contingent on the achievement of certain sales targets. Ironwood will also be eligible for royalties beginning in the mid-single-digit percent, based on the annual net sales of Linzess.
Analysts on FTSE 100 group
As of September 13, the consensus forecast amongst 26 polled investment analysts covering the Anglo-Swedish drugmaker for the Financial Times has it that the company will outperform the market. According to MarketBeat, the company currently has a consensus ‘hold’ rating, while the average target on the AstraZeneca share price stands at 7,050p.
JPMorgan recently reaffirmed the pharmco as an ‘overweight,’ pointing to positive trends for the FTSE 100 company and peers Novo and Roche seen in the first half of the year, and positive outlook going forward.