- Circassia Pharmaceuticals has reached agreement with AstraZeneca to enter into a collaboration and secure certain US commercial rights to two chronic obstructive pulmonary disease products, Tudorza and Duaklir, for a maximum total consideration of US$230m, plus future sales based royalties upon the commercialisation of Duaklir in the US, following potential approval.

Circassia said the transaction provided an opportunity to transform its product portfolio and commercial presence and the products represented a clear strategic fit with Circassia's focus on respiratory medicines and would leverage and enhance Circassia's commercial infrastructure.

Circassia said Tudorza was approved in the United States and approximately 60 further countries around the world.

Total AstraZeneca revenues related to worldwide sales of the product were US$170 million in 2016, of which US$80 million was in the United States.

Circassia said Duaklir was in phase III development in the United States for the treatment of COPD.

It was initially approved in the European Union in 2014 and has been approved in approximately 50 countries worldwide.

Circassia said it would issue ordinary shares with a value of US$50 million to AstraZeneca on completion of the transaction and would pay AstraZeneca deferred non-contingent consideration of US$100 million on the earlier of: (i) 30 June 2019; and (ii) the approval of Duaklir by the FDA.

Chief executive Steve Harris said: "This proposed transaction is an ideal fit with Circassia's strategy and respiratory focus.

"It represents a transformational opportunity for the Company, doubling the number of marketed products in our portfolio, with the potential to triple the current number within two years.

"Through an initial commercial collaboration with AstraZeneca, we plan to double our US sales force to promote Tudorza as our priority, as well as our existing NIOX products, transforming Circassia into a world-class respiratory business positioned for future in-licensing and M&A.

"In addition, the transaction structure is highly attractive, allowing us to fund the consideration without further investment anticipated from shareholders, while at the same time welcoming AstraZeneca to our share register."

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