Drug developer Bristol-Myers Squibb Co. has received a $2.7 billion payment from Anglo-Swedish counterpart AstraZeneca PLC as part of the sale of its global diabetes business, a deal that could eventually be worth more than $4 billion.
The New York company said Monday it also will receive a $600 million payment later this month due to the recent U.S. regulatory approval of Farxiga, a once-a-day tablet developed by both companies and designed to help diabetes patients eliminate excess sugar through their urine.
Bristol-Myers also is in line to receive another $800 million in milestone payments and sales-based royalties through 2025.
The deal involves the rights to Bristol-Myers' global diabetes business that was part of a collaboration with AstraZeneca.
Bristol-Myers agreed to sell its share of the diabetes business to AstraZeneca as the U.S. pharmaceutical company undergoes a makeover from a producer of drugs for the masses to a creator of specialty drugs for complex disorders.
Shares of Bristol-Myers slipped 19 cents to $49.78 in morning trading Monday. The stock had already dropped 6 percent so far this year, as of Friday's close.