Recently, AstraZeneca (AZN) decided to acquire a France-based research company Novexel for an initial payment of $350 million and another $80 million for Novexel’s cash balance. Novexel is also eligible to receive another $75 million on the achievement of certain milestones. The deal primarily involves two candidates CAZ104 and CEF104 which are being studied for the treatment of infections in the abdomen and urinary tract as well as hospital acquired pneumonia. Next year, both of them are expected to enter into phase III and phase II development, respectively. AstraZeneca expects to file CAZ104 with the regulators in both the US and EU in 2012.

Under a separate deal, AstraZeneca entered into a collaboration agreement with Forest Laboratories (FRX) regarding the development of the two compounds acquired following the Novexel deal. CAZ104 and CEF104 are combination compounds, both having NXL-104, a compound developed by Novexel. While the former combines NXL-104 with ceftazidime, an antiobiotic facing resistance from certain strains of bacteria, the latter contains ceftaroline, Forest’s late stage candidate to treat infections.

Following the completion of the acquisition, Forest has agreed to pay AstraZeneca half of the amount spent in acquiring Novexel. The two companies have agreed to share costs related to the development of these two drugs. While Forest will market the drug in North America, AstraZeneca will target the rest of the world with the exception of CEF104 in Japan, where Takeda retains the rights for ceftaroline. In addition, Forest will receive royalties on AstraZeneca’s global sales of the combination of NXL-104 and ceftaroline. Apart from NXL-104, Novexel’s pipeline includes a phase II oral anti-MRSA compound and several early stage and preclinical compounds.

Earlier, in January 2008, as per an agreement between Forest and Novexel, the former was granted rights to develop CEF104 in North America. Thereafter, in August this year, AstraZeneca entered into an agreement with Forest to secure the rights to commercialize ceftaroline outside North America and Japan.

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