AZ takes control of Ironwood's IBS drug in China

AstraZeneca has amended a collaboration agreement with Ironwood Pharmaceuticals, gaining sole responsibility for developing, manufacturing and marketing an irritable bowel syndrome drug in China.

The two companies began a collaboration to co-develop and co-market Linzess in 2012, covering mainland China, Hong Kong, and Macau.

China’s National Medical Products Administration approved Linzess in irritable bowel syndrome with constipation (IBS-C) in January this year and launches are expected later this year.

Ironwood will no longer be involved in R&D or the marketing of Linzess (linaclotide), a first-in-class treatment for IBS-C.

In return for the rights AZ will pay Ironwood three payments totalling $35 million, between 2021 and 2024.

Ironwood could receive up to $90m in milestone payments, upon the achievement of certain sales targets.

Massachusetts-based Ironwood will also be eligible for royalties beginning in the mid-single-digit percent, based on the annual net sales of Linzess in mainland China, China Hong Kong and China Macau.

Ironwood will no longer jointly fund the development and marketing of Linzess or share in the profit from sales.

Like many pharma companies AZ sees China as an increasingly important market, and the UK-based pharma has considerable marketing power there already.

Handing over the rights will mean allowing Ironwood to enjoy revenues from Linzess in China without having to make substantial investment in human resources and infrastructure.

Last year it emerged that a deal between AZ and Ironwood had gone sour - the US pharma handed back rights to two gout drugs after dismal sales of just over a million dollars per year for the two drugs.

Leon Wang, president of AstraZeneca China, said: “Linzess is an important new treatment for this type of IBS in China, where there is a specific high unmet medical need. Today’s amended agreement allows us to bring this innovative medicine to patients more efficiently and will contribute further to our strong growth in this significant market.”

Mark Mallon, CEO of Ironwood, said: “AstraZeneca has substantial experience and capabilities in developing and commercialising medicines in China. There are approximately 14 million adults suffering from IBS-C in China alone and we believe AstraZeneca is well-positioned to bring Linzess to these patients.”