AstraZeneca Plc (NYSE:AZN), a global, a science-led biopharmaceutical company, announced on Wednesday that it has agreed on the sale and license of the commercial rights to Seroquel (quetiapine fumarate immediate release) and Seroquel XR (quetiapinefumarate extended release) in Europe and Russia to Cheplapharm Arzneimittel GmbH.

Reportedly, Seroquel and Seroquel XR, used primarily to treat schizophrenia and bipolar disorder, have lost their compound patent protection in Europe and Russia.

Under this deal, Cheplapharm will make an upfront payment of USD178m to AstraZeneca and may also make future sales-contingent payments of up to USD61m. Income arising from the upfront and future payments will be reported in AstraZeneca's financial statements within Other Operating Income & Expense. In 2018, Seroquel generated annual product sales of USD47m in the markets covered by this agreement, while Seroquel XR generated USD61m. The consideration will be paid in cash and the proceeds used for general corporate purposes.

According to the company, Seroquel is an important established medicine and this agreement with Cheplapharm will help ensure continued patient access. This divestment forms part of the company's strategy of reducing the portfolio of mature medicines to enable reinvestment in its main therapy areas.

AstraZeneca added that it will continue to manufacture and supply Seroquel and Seroquel XR to Cheplapharm during a transition period.

Also, under Listing Rule 10.4.1R (notification of class 2 transactions), the gross book value of assets subject to the divestment as at 31 December 2018 was nil. In the year to 31 December 2018, the aggregate pre-tax profits attributable to Seroquel and Seroquel XR in the relevant territories were USD86m.

AstraZeneca clarified that this agreement does not impact the company's financial guidance for 2019.

This transaction is expected to complete in the fourth quarter of 2019, subject to customary closing conditions and regulatory clearances.

AstraZeneca is focused on the discovery, development and commercialisation of prescription medicines, primarily for the treatment of diseases in the three therapy areas of Oncology, Cardiovascular, Renal and Metabolism and Respiratory.