(Reuters) - Drugmaker Insmed Inc (O:INSM) said on Wednesday it had bought the rights to an experimental early-stage respiratory drug from Britain's AstraZeneca Plc (L:AZN) in a deal worth $150 million (118 million pounds).
AstraZeneca will get $30 million in upfront fees and $120 million in various milestone payments, Insmed said.
The deal adds AstraZeneca's AZD7986 compound to Insmed's pipeline. AZD7986 is designed to stop an enzyme that regulates inflammation in the respiratory system.
The British drugmaker has been trimming its pipeline by licensing its experimental drugs to other companies as it focuses on its cancer treatments.
The licensing deal with Insmed comes two days after AstraZeneca sold the rights to a treatment for inflammatory disease to Allergan Plc (N:AGN).
AstraZeneca, which has a long history of developing successful respiratory medicines, is focussing its resources on benralizumab, an experimental drug for severe asthma.
Insmed, which focuses on developing treatments for respiratory diseases, said it would start a mid-stage study of the drug in non-cystic fibrosis bronchiectasis, a disease in which the airways in the lungs become permanently dilated due to chronic inflammation and infection.
Insmed is also testing Arikayce in late-stage studies to treat chronic lung infections.
According to deal terms, AstraZeneca has the option to negotiate a deal to develop AZD7986 in chronic obstructive pulmonary disease or asthma.
AstraZeneca shares were flat at 5012 pence at 1157 GMT on the London Stock Exchange.