Drug giant AstraZeneca (LON:AZN) has unveiled a US$2.7bn takeover bid for US drug developer ZS Pharma, marking the latest move in a wave of M&A in the sector.
AstraZeneca has agreed to pay US$90 a share in cash for ZS Pharma (NASDAQ:ZSPH), whose shares closed 3% down at US$63.31 in New York on Thursday.
ZS Pharma is developing a treatment for hyper-kalaemia, a serious condition of high potassium levels in the bloodstream linked to chronic kidney disease and chronic heart failure.
The deal will give AstraZeneca access to the potassium-binding compound ZS-9, a potential best-in-class treatment for hyper-kalaemia.
ZS-9 is under regulatory review by the US Food and Drug Administration and a submission for European Marketing Application Authorisation is planned by the end of 2015.
Current estimates for global peak year sales of ZS-9 exceed US$1bn.
There had been speculation that rival drug company Shire (LON:SHP) was also interested in a potential bid for California-based ZS Pharma.
AstraZeneca is targeting acquisitions to boost its range of drugs under development as exclusivity of flagship treatments such as cholesterol drug Crestor expires, leaving it open to competition from copy-cat drugs.
Shire, which made a US$30bn bid for Baxalta in August, is also eyeing acquisitions as it attempts to become a global leader in rare disease medicines.
Upon completion, ZS Pharma, which has around 200 staff across three sites in California, Texas and Colorado, will become a wholly owned subsidiary of AstraZeneca.
AstraZeneca, which on Thursday increased its annual earnings expectations, said the deal would not affect its financial guidance for 2015.
AstraZeneca chief executive Pascal Soriot said: "Hyperkalaemia can be a life-threatening condition for patients with chronic kidney disease and chronic heart failure; however, the risk is under appreciated and prevalence is increasing. This acquisition complements our strategic focus on cardiovascular and metabolic disease."
ZS Pharma chief executive Robert Alexander said: "This agreement will allow us to maximise the potential of ZS-9, drawing on AstraZeneca's long-standing expertise in developing and commercialising medicines for cardiovascular and metabolic diseases."