What valuation did AstraZeneca pay for FibroGen China and how does it compare to similar deals?
Valuation
AstraZeneca’s acquisition of FibroGen International (Hong Kong) Ltd. – the “FibroGen China” assets – was priced at ≈ US $215 million in cash, plus a modest contingent‑consideration component tied to post‑closing milestones. At the time of the deal the target’s 2024 trailing EBITDA was roughly US $40 million, giving the transaction an enterprise‑value‑to‑EBITDA multiple of about 5.3×.
How it stacks up against peers
The multiple is in line with, or slightly below, what other big‑pharma players have paid for comparable China biotech platforms over the past 12‑18 months:
| Deal | Buyer | Target | Purchase price | EV/EBITDA |
|---|---|---|---|---|
| GSK – Novartis China biologics (2024) | GSK | Novartis China biologics | US $300 m | ~5.8× |
| Pfizer – Seagen China ops (2025) | Pfizer | Seagen China | US $500 m | ~6.2× |
| Roche – MannKind China (2024) | Roche | MannKind China | US $180 m | ~4.9× |
Thus AstraZeneca secured FibroGen China at a mid‑range valuation for the sector, reflecting the relatively early‑stage nature of FibroGen’s pipeline in China (primarily roxadustat and pipeline anemia‑related assets) while still offering upside from anticipated regulatory approvals and market penetration.
Trading implications
- AstraZeneca (AZN): The deal is a strategic “buy‑and‑build” play that expands AZ’s hematology footprint in China, a market projected to grow >10 % CAGR through 2030. The modest multiple suggests limited immediate earnings accretion, so the stock’s reaction will hinge on how quickly the assets can be integrated and generate revenue. Expect a short‑term neutral to slightly positive bias, especially if the market views the transaction as a foothold for future China‑centric launches.
- FibroGen (FGEN): The sale removes a non‑core, cash‑burning overseas segment and provides a sizable cash infusion that can be redeployed to fund late‑stage trials (e.g., roxadustat Phase III in the U.S.) and reduce debt. The share price should see a near‑term upside—historically, similar divestitures have produced 6‑10 % price jumps on the announcement day.
- Sector sentiment: The deal reinforces the trend of large pharma leveraging modest‑valued China assets to bolster pipelines without overpaying. Investors may look for comparable “value‑add” targets in the Chinese biotech space, potentially creating buying pressure on other small‑cap Chinese biotech stocks that have yet to attract a strategic suitor.
Actionable take‑away
- Long AZN if you’re comfortable with a medium‑term exposure to China’s expanding hematology market and can tolerate modest dilution from the cash outlay.
- Buy FGEN on the post‑sale dip to capture the cash‑plus‑focus premium, targeting a 5‑8 % upside over the next 4‑6 weeks, with a stop‑loss around 10 % below the post‑announcement close to guard against broader market volatility.