DRUG giant AstraZeneca lifted full-year earnings targets today after sealing a multi-million pound deal to sell marketing rights for its heartburn pill to US rival Pfizer.
Embattled AstraZeneca - the UK’s second-biggest pharmaceuticals group - will receive 250 million US dollars (£159.3 million) upfront after giving Pfizer exclusive global marketing rights for the over-the-counter (OTC) version of acid reflux treatment Nexium.
Astra will also be eligible to get milestone and royalty payments from Pfizer based on product launches and sales of the OTC medication.
Cheshire-based Astra said the deal would increase its 2012 earnings per share target.
The deal comes at a welcome time for Astra, which has been suffering from plunging sales and profits amid competition from cheaper generic drugs and challenging market conditions.
It recently revealed that half-year profits slumped by a quarter after a 16% slide in sales in the six months to June 30.
Nexium - launched in Europe in 2000 and in 2001 in the US - has been a star performer for the group, but it has also been hit by generic competition and saw revenues fall 13% in the second quarter.
Astra, which will continue to manufacture and market the prescription version of Nexium, said the deal with Pfizer will help it "realise the substantial, long-term value of this brand".
It is also working with Pfizer on similar potential deals for other OTC versions of its drugs, such as hay fever and dust mite allergy treatment Rhinocort Aqua.
Astra has had a tough year and its chief executive David Brennan quit in June following shareholder pressure over profit warnings and poor performance.
The group is slashing jobs and cutting costs to offset poor performance, having announced its intention to axe 7,300 roles in February.