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AstraZeneca (AZN) to Buy Full Stake in Rare Disease Drugmaker

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AstraZeneca’s AZN newly acquired subsidiary, Alexion, has exercised its option to acquire all remaining shares of Caelum Biosciences, in which it holds a minority equity interest. With the full acquisition of Caelum, AstraZeneca will add the latter’s phase III candidate, CAEL-101, a potentially first-in-class fibril-reactive monoclonal antibody (mAb) for the treatment of light chain (AL) amyloidosis.

AstraZeneca will take care of advancing the ongoing phase III study, called CARES, on CAEL-101 which is evaluating the candidate in combination with standard-of-care (SoC) therapy in AL amyloidosis.

This year so far, AstraZeneca’s shares are up 19.3% compared with an increase of 6.9% for the industry.

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AL amyloidosis is a rare disease in which amyloid proteins build up in organs of the body, including the heart and kidneys, causing damage to them and can be fatal eventually. CAEL-101 has been designed in such a way that it can improve organ function by reducing or eliminating amyloid deposits from organ tissues.

Approximately 20,000 people suffer from AL amyloidosis across the United States, France, Germany, Italy, Spain and the UK. If successfully developed and approved to treat this devastating disease, CAEL-101can bring in strong revenues for AstraZeneca due to a significant unmet need in the disease area where the median survival time is less than 18 months following diagnosis.

Alexion acquired a minority interest in Caelum in 2019 under a collaboration deal with the latter, which also included an exclusive option to acquire the remaining equity in Caelum. The acquisition is expected to close on Oct 5 when AstraZeneca will pay an option exercise price of approximately $150 million to Caelum with the latter remains entitled to receive up to $350 million in potential regulatory and commercial milestone payments.

The acquisition of Caelum builds on AstraZeneca’s July 2021 buyout of rare disease drugmaker, Alexion for $39 billion and strengthens the British giant’s presence in the rare disease market. The Alexion buyout strengthened its immunology franchise, adding several drugs that can boost its top line.

AstraZeneca currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Some better-ranked large drugmakers are Sanofi SNY, Pfizer PFE and Novo Nordisk NVO, which have a Zacks Rank #2 (Buy).

Pfizer’s stock has risen 18.1% this year so far. Earnings estimates for 2021 have gone up from $4.01 to $4.09 and from $3.35 to $3.52 for 2022 over the past 60 days

Novo Nordisk’s stock is up 37.6% this year so far. Estimates for Novo Nordisk’s 2021 earnings have increased from $3.09 to $3.26 per share in the past 60 days while that for 2022 have risen from $3.36 to $3.61 over the same period.

Though Sanofi’s stock is down 0.4% this year so far, its earnings estimate for 2022 has gone up from $4.30 to $4.31 over the past 60 days.

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Sanofi (SNY) : Free Stock Analysis Report

AstraZeneca PLC (AZN) : Free Stock Analysis Report

Pfizer Inc. (PFE) : Free Stock Analysis Report

Novo Nordisk AS (NVO) : Free Stock Analysis Report

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