Biotechnology company Spectrum Pharmaceuticals Inc (NASDAQ-GS:SPPI) revealed on Thursday the launch of a definitive agreement to divest its portfolio of seven products to Acrotech Biopharma LLC, a New Jersey-based wholly-owned subsidiary of Aurobindo Pharma USA Inc, for USD160m up-front cash payment.

In conjunction with the sale, Spectrum will receive up to USD140m in regulatory and sales-based milestones. The milestone period lasts for five years post the closing of the transaction, which is expected to close within 90 days.

Under the sale, the seven US FDA-approved hematology/oncology products include: FUSILEV (levoleucovorin), FOLOTYN (pralatrexate injection), ZEVALIN (ibritumomab tiuxetan), MARQIBO (vinCRIStine sulfate LIPOSOME injection), BELEODAQ (belinostat) for injection, EVOMELA (melphalan) for injection, and KHAPZORY (levoleucovorin). The products generated combined sales of USD76.4m during the first nine months of 2018.

However, the KHAPZORY milestones is only payable in the event KHAPZORY is assigned a unique J-code, added the company.

Following the acquisition, Spectrum's staff size will be reduced by approximately 40%, with the majority of impacted staff transitioning to Acrotech. Spectrum will retain a core group of commercial talent to lead the launch of ROLONTIS (eflapegrastim) and poziotinib.

The boards of directors of both the companies have approved the transaction, which is subject to regulatory approvals.