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AstraZeneca makes $1.8bn move for CinCor Pharma

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AstraZeneca makes $1.8bn move for US blood pressure drug maker CinCor as pharma giant expands heart and kidney portfolio

  • London-listed AstraZeneca said that it could spend c.$1.3bn upfront for CinCor
  • Astra exec: ‘Acquiring CinCor supports our commitment to cardiorenal disease’ 
  • CinCor shares plunged in November following an unsuccessful Baxdrostat trial

AstraZeneca has agreed to amass pharmaceutical group CinCor Pharma in a deal value a possible $1.8billion (£1.5billion) to reinforce its heart and kidney drugs portfolio.

The biotechnology giant said that it could spend around $1.3billion, or $26 per share, upfront to take over the Massachusetts-based business, representing a premium of 121 per cent to the stock’s closing price last Friday. 

An additional $10 per share will probably be paid out to investors depending on a specific regulatory submission for Baxdrostat, a blood pressure and cardiorenal condition treatment.

Takeover: AstraZeneca has agreed to amass Massachusetts-based pharmaceutical group CinCor Pharma in a deal value a possible $1.8billion 

In early November, the outcomes of a phase two trial published within the Latest England Journal of Medicine showed that the drug notably reduced hypertension amongst patients immune to other medicines.

It achieved this by limiting the event of aldosterone, a hormone used to manage a body’s salt content, in a subject’s urine and blood.

Nonetheless, results from a separate study published three weeks later found that Baxdrostat didn’t significantly lower blood pressure when measured against a placebo.

This caused CinCor’s shares to plummet by nearly half in at some point. They continue to be just over 1 / 4 below the corporate’s initial public offering price of $16 per share in January 2022.

In total, London-listed AstraZeneca’s bid for CinCor is value roughly 206 per cent of the latter’s closing share price on Friday. 

One other two Baxdrostat trials are currently happening, while an additional Phase III investigation is about to start sometime throughout the first half of this yr.

AstraZeneca said it could eventually hope to mix the drug with Farxiga, certainly one of its most popular-selling medicines and commonly used to treat Type 2 diabetes and heart failure.

Mene Pangalos, the firm’s executive vice-president of biopharmaceuticals research and development, said: ‘Acquiring CinCor supports our commitment to cardiorenal disease and further strengthens our pipeline with baxdrostat.

‘Excess levels of aldosterone are related to hypertension and a number of other cardiorenal diseases, including chronic kidney disease and coronary artery disease and with the ability to effectively reduce this may offer a much-needed treatment option for these patients.’

AstraZeneca shares were 0.4 per cent lower at 11,736p just before trading closed on Monday, although their value has grown by about 41 per cent up to now 12 months. 

The FTSE 100 group’s latest deal comes at first of the JP Morgan Healthcare conference in California, the world’s biggest annual healthcare investment industry gathering, which is being held in-person for the primary time in three years. 

Analysts are predicting a flurry of pharmaceutical sector deals in 2023, given the relative underperformance of many biotech shares over the past yr.

Victoria Scholar, Interactive Investor’s head of investment, added that with the poorer global economic outlook, ‘investors are more risk averse, looking towards defensive sectors equivalent to pharmaceuticals to weather the downturn.’

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