Bristol-Myers Squibb sells off diabetes business

NEW YORK — Bristol-Myers Squibb is selling its diabetes business to AstraZeneca for up to $4.3 billion as part of an effort to focus more on specialty drugs, the company said Thursday.

BMS said AstraZeneca would pay $2.7 billion upfront, as well as up to $1.4 billion in milestone payments and up to $225 million on the condition of certain assets being sold. The companies have had a diabetes drug-development partnership since 2007.

"This agreement will allow us to further evolve our business model as a leading specialty biopharma company and increase resources behind the opportunities that drive the greatest long-term value for patients, our company and our shareholders," BMS CEO Lamberto Andreotti said. "Today's announcement puts the diabetes franchise in the capable hands of AstraZeneca and allows us to move to a more simplified operating model with our pipeline and portfolio."

Many drug companies have sought to increase investment in specialty drugs — used to treat such serious conditions as cancer, autoimmune diseases, chronic viral infections and genetic disorders — in recent years as drugs for treating such primary-care diseases as cardiovascular disease and acid reflux have lost patent protection, and those disease states have become dominated by generics. Analysts have pointed out, however, that diabetes remains one of the few primary-care disease states that will remain profitable for drug companies and continue to see development of new treatments.