Allergan to offload IL-23 inhibitor brazikumab and Zenpep as part of AbbVie merger

Allergan entered into definitive agreements to divest the experimental IL-23 inhibitor brazikumab and the pancreatic enzyme drug Zenpep (pancrelipase) as part of the ongoing regulatory approval process for its pending takeover by AbbVie, the companies announced Monday. Richard Gonzalez, CEO of AbbVie, noted that the deals "represent significant progress toward the completion of our acquisition of Allergan."

In June last year, AbbVie agreed to acquire Allergan for approximately $63 billion, with the latter indicating that it would divest brazikumab and Zenpep in connection with the transaction. Regulators are still reviewing the proposed merger, with the companies noting in September that the US Federal Trade Commission had made a second request for additional information about the deal. Meanwhile, the European Commission approved the transaction earlier this month on condition that brazikumab be divested as it was "likely to compete closely" with Skyrizi (risankizumab), an anti-IL-23 antibody being co-developed by AbbVie and Boehringer Ingelheim to treat multiple inflammatory diseases.

The drugmakers noted that AstraZeneca will acquire brazikumab, also known as MEDI2070 and as AMG-139, having out-licensed the drug to Allergan in 2016 as it fell outside of the UK company's main focus areas. Brazikumab is currently in Phase IIb/III development for Crohn's disease and a Phase II trial in ulcerative colitis.

AstraZeneca said that it will terminate the existing licensing agreement with Allergan, with the latter expected to fund the completion of development for brazikumab in Crohn's disease and ulcerative colitis, including the development of a companion diagnostic. Further, as part of a deal signed in 2012, Amgen is entitled to receive a high-single-digit to low-double-digit royalty on sales of brazikumab if approved and launched. 

Mene Pangalos, executive vice president of biopharmaceuticals R&D at AstraZeneca, said "this agreement creates an opportunity for us to complete the full development programme and bring this potential new treatment option to patients as quickly as possible." Liberum analyst Alistair Campbell noted that while brazikumab "could be another autoimmune product to add to AstraZeneca's portfolio...it will be somewhat late to the market," following approvals last year for Skyrizi in Japan, Canada and the US.

Meanwhile, Nestlé will acquire and take full operational ownership of Zenpep, which is sold in the US for exocrine pancreatic insufficiency due to cystic fibrosis and other conditions. In 2018, the product generated sales of $237 million. Nestlé will also acquire Viokace, another pancreatic enzyme preparation, as part of the same transaction.

"This is a significant opportunity for our business in the [US]," remarked Greg Behar, CEO of Nestlé health science, with the purchase boosting the company's medical nutrition portfolio. Although terms of the deal were not disclosed, analysts at Zuercher Kantonalbank estimated the takeover could have cost Nestlé more than $1 billion.

AbbVie and Allergan said Monday that they continue to expect the merger to close in the first quarter.  

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