AstraZeneca Expands China Presence with $160M FibroGen Deal Amid Ongoing Probes
AstraZeneca has announced a $160 million acquisition of FibroGen's China business, solidifying its position in the Chinese pharmaceutical market despite ongoing government investigations. The deal, expected to close by mid-2025, grants AstraZeneca full rights to the anemia drug roxadustat in China and expands its foothold in the world's second-largest pharmaceutical market.
Strategic Acquisition Amidst Regulatory Scrutiny
AstraZeneca will pay $85 million for the enterprise value of FibroGen China, plus an additional $75 million corresponding to the net cash held by the Chinese business. This move comes as AstraZeneca faces several government probes in China, including an investigation into former AstraZeneca China president Leon Wang and potential insurance fraud allegations involving other top executives.
Despite these challenges, AstraZeneca CEO Pascal Soriot remains optimistic about the company's future in China, stating, "longer term, we see continuous opportunity for growth in China." The acquisition signals AstraZeneca's commitment to the Chinese market, where it has maintained a presence since 1993.
Roxadustat: A Key Asset in China's Anemia Market
The deal gives AstraZeneca full rights to roxadustat in China, where it is approved for the treatment of anemia in chronic kidney disease (CKD) and is undergoing regulatory review for chemotherapy-induced anemia. Roxadustat, marketed as Evrenzo, is currently the leading drug in China's CKD anemia market.
However, the drug faces potential competition from generic versions, with Chinese pharmaceutical giant CSPC Pharmaceutical receiving approval for its generic roxadustat last summer. Several other companies have also filed for approval of their copies in China.
Financial Implications for FibroGen
For FibroGen, the sale of its Chinese subsidiary provides a much-needed cash infusion. The biotech plans to use the proceeds to repay an outstanding term loan facility to Morgan Stanley Tactical Value, extending its cash runway into 2027. This financial boost will allow FibroGen to continue advancing its oncology pipeline and fund ongoing research and operations.
FibroGen CEO Thane Wettig commented on the deal, saying it "bolsters our company on several fronts" by strengthening the company's financial position and enabling continued progress on key development programs, including the CD46-targeting antibody-drug conjugate FG-3246 and companion PET imaging agent FG-3180 for metastatic castration-resistant prostate cancer (mCRPC).
References
- AstraZeneca Buys FibroGen’s China Unit for $160M as Probes Continue
A year ago, AstraZeneca walked away from the bulk of its roxadustat partnership with FibroGen—though the pharma at the time decided to retain its relationship with the biotech’s China operations.
- AstraZeneca deepens China presence with FibroGen deal
The $160 million acquisition of a FibroGen subsidiary expands AstraZeneca’s foothold in China while the company works through government investigations into its business practices there.
- AstraZeneca pays $160M for FibroGen's China unit, regional rights to roxadustat
AstraZeneca is paying $160 million for FibroGen’s Chinese business, giving the U.K.-based Big Pharma the regional rights to oral anemia drug roxadustat.
Explore Further
What are the key strategic objectives for AstraZeneca in acquiring FibroGen's China business?
How does roxadustat's market presence in China compare to its generic competitors?
What potential impact could the government probes have on AstraZeneca's operations in China?
How will the sale of FibroGen's Chinese subsidiary affect its financial strategy moving forward?
What measures is AstraZeneca taking to address potential insurance fraud allegations involving its executives in China?