Shares of both Astrazeneca (AZN) and Amgen (AMGN) fell about 2% today after both companies reported that the partnership established back in 2012 for a psoriasis drug would come to an end. The partnership established back in April 2012 allowed Astrazeneca to Co-develop five drugs from Amgen's inflammation portfolio. To secure this collaboration deal Astrazeneca paid Amgen an upfront payment of $50 million dollars. 

Both companies expected to split the costs of all the clinical trials related to the inflammation product portfolio, and in addition both would share future revenue of the products. The drug compound is known as Brodalumab and was being developed to target patients with psoriasis and psoriatic arthritis. The reason, Amgen got out of this deal is because they believe that severe side effect of "suicidal thoughts" would require a black box label warning from the FDA and the sales for Brodalumab would be limited. 

Not only that the black label warning from the FDA will limit the sales of Brodalumab for psoriasis but because the drug would face competition from other big pharma companies that are currently developing drugs for psoriasis as well. Both Novartis AG (NVS) and Eli Lily (LLY) are also in the process of developing drugs for psoriasis as well. Amgen claims it was just the possible black box label warning that cause them to back out, but its possible they considered the fact that Brodalumab would meet competition from other big pharma companies as well. 

Astrazeneca is awaiting for further analysis to determine if the Brodalumab program should be closed. It is taking into consideration the "suicidal thoughts" side effect which may give it a black box label warning from the FDA. Analysts estimated that sales for Brodalumab could possibly be between $500 million to $1.5 billion. Because of many conditional factors like competitors in the psoriasis space it is to early to tell whether or not the FDA will put a black box label warning on the product.