AstraZeneca takes novel approach, spinning out GI resarch into new firm

The UK's second-largest pharmaceutical company, AstraZeneca, took an unusual step spinning out its gastrointestinal drug research into a new private equity-backed biotechnology firm. Specifically, the Anglo-Swedish drug major and Nomura Phase4 Ventures have signed a deal to form Albireo, a company focused on developing new treatments for gastrointestinal GI disorders.

Albireo, based in Gothenburg, Sweden, has secured one clinical and a number of preclinical GI programs from AstraZeneca, as well as several researchers with extensive experience in the UK-based group's GI research area. The spin-out is a result of AstraZeneca's previously-announced strategic decision to concentrate on Nexium (omeprazole) and internal GI research focussed on gastroesophageal reflux disease. Nexium itself generated revenues of $5.18 billion for the group in 2007, up 12% on the previous year, but with fourth-quarter sales of the drug down 9% due to the encroachment of generic competition in the USA (Marketletter February 11).

$53M raised, $40M to come