AstraZeneca to buy Pearl Therapeutics for $1.15 billion

Drugmaker AstraZeneca said Monday that it has agreed to pay as much as $1.15 billion for Pearl Therapeutics, a privately held company based in Redwood City, Calif., that focuses its research on inhaled medication for respiratory disease, specifically chronic obstructive pulmonary disease (COPD).

AstraZeneca is based in the United Kingdom, but has operations in Wilmington and Newark, Del.

Pearl's lead product, PT003, is starting a Phase 3 clinical trial and the company hopes the drug and delivery technology can lead to others.

AstraZeneca said in a statement that under the terms of the deal, it will buy all of Pearl's stock for $560 million. Reaching specific developmental and regulatory milestones would prompt a second payment of $450 million. Then, if sales-related targets are met, as much as $140 million more would be transfered.

“Chronic obstructive pulmonary disease continues to increase worldwide and there is a growing need for the next generation of inhaled combination products," AstraZeneca chief executive officer Pascal Soriot said in a statement. "Pearl’s novel formulation technology, together with its development products and specialist expertise are a great complement to AstraZeneca’s long-established capabilities in respiratory disease, one of our core therapy areas. Combined with our on-market portfolio, including Symbicort, and our strong pipeline, the agreement will enable us to offer further distinctive treatment options across the full spectrum of COPD and asthma to patients, physicians and payers.”

Pearl was founded in 2006 and its key funding is provided by venture capital firms. Vatera Healthcare Partners is the lead investor and others include 5AM Ventures, Clarus Ventures and New Leaf Ventures.

“We have been impressed with AstraZeneca’s expertise, focus and speed of execution and are delighted to be joining the group, a global leader in respiratory disease, as we believe that Pearl will be an excellent fit for its respiratory portfolio," Kevin Ferro, Pearl board chairman and CEO of Vatera Healthcare Partners, said in a statement. "We believe AstraZeneca will provide significant value in supporting the further development and registration of our lead product, PT003, and in leveraging our technology platform to realize future products including a triple agent therapy for respiratory disease. I would like to thank Pearl’s partners, management team and everyone on the Pearl team for the extraordinary contributions that they have made to progress the company to this stage. We are looking forward to working with AstraZeneca to realize the full potential of the Pearl portfolio and to offer a range of therapies to dramatically improve patients’ lives.”

AstraZeneca's statement is here.