AstraZeneca to buy ZS Pharma for $2.7 bn

British drug giant AstraZeneca Plc today struck a deal to buy ZS Pharma for $2.7 billion in order to strengthen its cardiovascular and metabolic disease portfolio.

Under the terms of the deal, AstraZeneca will pay $90 a share in cash for the California-based company.

Upon closing, ZS Pharma, which has around 200 employees across three sites in California, Texas and Colorado, will become a wholly-owned subsidiary of AstraZeneca.

AstraZeneca said that the transaction does not impact its financial guidance for 2015.

It is expected to generate product sales from 2016, with minimal earnings dilution over 2016 and 2017, becoming accretive to the company's core earnings from 2018.

The transaction will give AstraZeneca access to the potassium-binding compound ZS-9, a potential best-in-class treatment for hyperkalaemia, a condition associated with increased mortality in chronic kidney disease and chronic heart failure.

ZS-9 is under regulatory review by the US Food and Drug Administration and plan to submit for European Marketing Application Authorisation by the end of 2015.

The London-based company said that current estimates for global peak year sales of ZS-9 exceed $1 billion and ZS Pharma represents a strong fit with its own pipeline and portfolio in cardiovascular and metabolic disease, one of the company's three main therapy areas.

AstraZeneca's strategy focuses on reducing morbidity, mortality and organ damage by addressing multiple risk factors across cardiovascular disease, diabetes and chronic kidney disease.

''Hyperkalaemia can be a life-threatening condition for patients with chronic kidney disease and chronic heart failure, however the risk is underappreciated and prevalence is increasing. This acquisition complements our strategic focus on Cardiovascular and Metabolic Disease by adding a potential best-in-class treatment to our portfolio of innovative medicines,'' said, Pascal Soriot, CEO of AstraZeneca.