AstraZeneca has eyed up two Asian companies for drug development deals just a day after being hit with the bad news that two hotly touted drugs failed to pass muster in clinical trials.

The deals with Astellas subsidiary Prosidion and Chi-Med see the pharma giant being able to acquire pipeline drugs for type 2 diabetes and a novel targeted cancer therapy.

The Prosidion agreement grants AstraZeneca an exclusive option to acquire the Phase II clinical and pre-clinical drugs PSN821 and PSN 842, respectively, which are a potentially new orally administered class of medicines for the treatment of type 2 diabetes. The financial terms of the agreement have been undisclosed.

Meanwhile, AstraZeneca has to pay $20 million up front to Chi-Med for the global licensing, co-development and commercialisation of Volitinib (HMPL-504), a selective inhibitor of the c-Met receptor tyrosine kinase for the treatment of cancer. Phase I testing is to begin shortly.

Under the terms of the agreement, development costs for Volitinib in China will be shared between AstraZeneca and Hutchison MediPharma, an R&D company majority owned by Chi-Med. AstraZeneca will lead and pay for the development of the drug outside of China. Beside the $20 million upfront payment, HMP will receive up to $120 million contingent upon the successful achievement of clinical development and first sale milestones as well as possible additional future commercial sale milestones and up to double digit percentage royalties on net sales.

Susan Galbraith, head of oncology innovative medicines at AstraZeneca said: “Volitinib represents a highly attractive global opportunity for AstraZeneca as we seek to develop and commercialise novel, targeted cancer therapies. This collaboration with HMP represents our commitment to China and brings together two groups with highly complementary capabilities.”

These deals seek to bolster AstraZeneca’s flailing pipeline, which is also being hit by generic competition and pricing pressures. These deals also attempt to make light of the news earlier this week that the company would take a $380 million charge to discontinue two failed late stage drugs for depression and cancer.