In a story Aug. 13 about drugmaker Pfizer Inc. buying the rights to sell a nonprescription version of heartburn drug Nexium from maker AstraZeneca PLC, The Associated Press reported erroneously that Pfizer bought Schering-Plough Corp. and acquired several consumer health products.
However, Pfizer bought a different drugmaker, Wyeth, in 2009 and acquired products including Advil, Caltrate, Centrum vitamins, ChapStick and Robitussin.
Pfizer didn't acquire the Dr. Scholl's foot care and Coppertone sun care product lines, which are now owned by rival Merck & Co.
Also, in one instance in the story, The Associated Press misspelled AstraZeneca.
A corrected version of the story is below:
Pfizer buys rights to OTC heartburn drug Nexium
Pfizer paying AstraZeneca $250M for rights to nonprescription version of heartburn drug Nexium
By LINDA A. JOHNSON
AP Business Writer
TRENTON, N.J. (AP) — Drugmakers AstraZeneca PLC and Pfizer Inc. have reached a deal giving Pfizer future rights to sell a nonprescription version of AstraZeneca's blockbuster heartburn drug, Nexium, as early as 2014.
The deal, announced late Monday, could help Pfizer expand its consumer health business as it continues a restructuring meant to strengthen its core drug business and divest its infant-formula and animal-health businesses. It would also help AstraZeneca to still get some revenue from one of its top sellers after generic competition hits. And the companies said they're exploring the idea of a partnership to convert other AstraZeneca prescription drugs to over-the-counter medicines.
In order to sell nonprescription Nexium, New York-based Pfizer must first win approval from the Food and Drug Administration and regulators in other countries. The drug, which treats ulcers and acid-reflux disease by reducing excess stomach acid, is known chemically as esomeprazole.
Nexium was the world's fifth-best-selling medicine last year, with global revenue of nearly $8 billion, according to health data firm IMS Health. The drug has long been touted in TV commercials as "the purple pill" that stops heartburn for 24 hours.
Viagra maker Pfizer said it is aiming to apply to the FDA in the first half of 2013 for approval of nonprescription Nexium in 20-milligram, delayed-release capsules. An application to sell the same dosage, but in tablet form, was filed with the European Medicines Agency in June.
If it wins approval, Pfizer aims to launch over-the-counter Nexium in the U.S. in 2014. The drug's patent is slated to expire in the U.S. that spring. Pfizer plans to begin selling the product in other countries after that.
Pfizer will pay London-based AstraZeneca $250 million upfront, then royalty and other payments based on product launches in various countries and sales revenue.
Both companies adjusted their 2012 financial forecasts as a result of the deal.
Pfizer lowered its earnings-per-share forecast by 2 cents, to $1.21 to $1.36 per share, or a range of $2.12 to $2.22 excluding one-time items. AstraZeneca said it will recognize the $250 million upfront payment as "other income" this year. That will increase its earnings per share by about 16 cents, to a range of $6 to $6.30.
Shares in Pfizer were up 3 cents to $23.75 in extended trading following the announcement. U.S.-traded shares of AstraZeneca rose 38 cents to $47.49.
AstraZeneca, best known for cholesterol drug Crestor, launched Nexium in the U.S. in 2001 and in Europe in 2000. It will still manufacture and sell prescription Nexium, and will supply Pfizer with the nonprescription version once that's approved.
AstraZeneca and a predecessor company have had a marketing partnership involving prescription Nexium and an older, similar heartburn drug called Prilosec, with Merck & Co. of Whitehouse Station, N.J., since 1982. Merck holds an interest in the two drugs and receives quarterly payments from AstraZeneca that total roughly $1 billion per year. That arrangement is unaffected by the new deal with Pfizer, although Merck and AstraZeneca amended their arrangement in June to give AstraZeneca an option to buy out Merck's interest in 2014.
Pfizer once had a large consumer-health products business, but sold its portfolio, including Listerine, to Johnson & Johnson several years ago. Pfizer now has several well-known consumer health products, including Advil, Caltrate, Centrum vitamins, ChapStick and Robitussin. Those were all acquired when Pfizer bought fellow drugmaker Wyeth in 2009.
Pfizer and AstraZeneca said Monday they have signed a deal giving Pfizer first refusal on the nonprescription rights to AstraZeneca's Rhinocort Aqua. That's a nasal pump spray for treating hay fever and dust mite allergies.
Linda A. Johnson can be followed at http://twitter.com/LindaJ_onPharma.