AstraZeneca Buys $160M Chinese Business from FibroGen to Expand Market

On February 20, AstraZeneca revealed its plans to acquire the Chinese operations of FibroGen for around $160 million. This strategic acquisition involves taking over a U.S.-based biotech company's activities in China, marking a shift from AstraZeneca's previous acquisition in December 2023, which involved a local company.

According to the agreement, FibroGen will receive $85 million in enterprise value along with around $75 million in cash held by FibroGen China, culminating in an approximate total of $160 million. The conclusion of this transaction is anticipated by mid-2025, subject to standard closing conditions, including regulatory approval from Chinese authorities.

Once finalized, AstraZeneca will obtain full rights to the drug Roxadustat within China. Meanwhile, FibroGen will maintain its rights to the drug in the United States and other markets not included in AstraZeneca's licensing agreements. Roxadustat is a significant product for FibroGen and is used to address anemia linked with chronic kidney disease.

The drug holds a notable place in medical history, as it was developed through a partnership between FibroGen and AstraZeneca. Roxadustat was approved for use in China in December 2018, making it the first oral hypoxia-inducible factor prolyl hydroxylase inhibitor to be launched worldwide. This approval marked a shift from the common trend where most innovative drugs receive approval in Western countries before reaching China.

AstraZeneca has been actively involved in the commercialization of Roxadustat in China, where the drug has shown strong performance, achieving sales of $284 million in 2023, equivalent to 2 billion yuan. Nevertheless, the drug is approaching a "patent cliff," with the expected introduction of a generic version by Shiyao Group in July 2024. Additionally, several other generic versions are under regulatory review.

AstraZeneca faces the challenge of extending the commercial lifespan of Roxadustat. FibroGen China is actively pursuing new therapeutic uses for the drug, with an application to treat anemia caused by chemotherapy already submitted to Chinese health authorities.

Lin Xiao, AstraZeneca's General Manager for China, highlighted that this acquisition will enhance the company's existing product lineup in the country and strengthen its investment in the local pharmaceutical sector. AstraZeneca eagerly awaits the regulatory verdict regarding Roxadustat's use for chemotherapy-related anemia, expected in early 2025.