Sanofi bets on mRNA vaccines beyond COVID in $ 3.2 billion deal with Translate Bio
- Sanofi and Translate Bio Develop Potential COVID-19 Vaccine
- Offering $ 38 / share for Translate Bio
- Offer gives Translate Bio a net worth of $ 3.2 billion
PARIS, Aug. 3 (Reuters) – Sanofi (SASY.PA) has agreed to buy US biotech company Translate Bio (TBIO.O) in a $ 3.2 billion deal because it is betting on next-generation mRNA vaccine technology beyond the COVID-19 pandemic, confirming an exclusive report from Reuters.
Sanofi has announced that it will acquire all of the outstanding shares of Translate Bio for $ 38.00 per share in cash, representing a total equity value of approximately $ 3.2 billion.
The boards of directors of both companies have approved the deal, and the chief executive of Translate Bio and the major shareholder of the US company have backed it, Sanofi and Translate Bio said in a joint statement.
Shares of the French pharmaceutical company edged up 0.3% in early morning trading.
“Translate Bio adds a strong mRNA technology platform and capabilities to our research, further strengthening our ability to explore the promise of this technology to develop both vaccines and world-class therapies,” said Paul Hudson , CEO of Sanofi.
Sanofi’s $ 38 offer represented a 30.4% premium to the closing share price of the New York-listed company on August 2.
Translate Bio’s share climbed more than 70% to exceed $ 50 in extended trading on Monday following the Reuters report. Read more
Sanofi’s offer for Translate Bio marks the latest interest of a large pharmaceutical company in mRNA technology, following its proven success in COVID-19 vaccines developed by Pfizer (PFE.N) / BioNTech and Moderna ( MRNA.O).
Analysts said the price made strategic sense, a long-term bet on mRNA vaccine technology beyond COVID-19 by one of the world’s leading flu vaccine makers.
“Since COVID, mRNA vaccines have had a significant impact on the future of vaccine R&D and the most obvious target for next generation mRNA vaccines is influenza,” Liberum wrote in a note from information.
The messenger RNA (ribonucleic acid) approach, Translate Bio’s area of expertise, requires human cells to make specific proteins that produce an immune response to a given disease.
Sanofi and Translate Bio joined forces last year to develop an mRNA-based COVID-19 vaccine. They are awaiting interim results from their Phase I / II clinical trial in the third trimester.
The two companies are also studying mRNA vaccines for several infectious diseases and in June launched a phase I trial evaluating a possible mRNA-based vaccine against seasonal influenza.
Rival Moderna launched a Phase I / II trial of a possible mRNA influenza vaccine in July.
Sanofi expects to complete the acquisition in the third quarter of 2021.
The CEO of Translate Bio and its main shareholder, the Baupost group, have signed binding commitments to support the agreement. Their shares combined with those already held by Sanofi represent approximately 30% of the total outstanding shares of Translate Bio.
Sanofi’s interest comes after a difficult year for the French drug maker after falling behind rivals in the COVID-19 vaccine race, a blow to CEO Hudson who joined the company nearly two years.
Sanofi warned last year that its traditional protein-based COVID-19 jab developed with GlaxoSmithKline (GSK.L) was showing an insufficient immune response in the elderly, delaying its launch until the end of 2021.
Hudson has also come under increasing pressure to reduce the company’s reliance on its flagship eczema treatment, Dupixent, in order to increase revenue.
Earlier this year, Sanofi agreed to fill and package millions of doses of shots manufactured by Pfizer / BioNTech, Johnson & Johnson (JNJ.N) and Moderna.
Translate Bio, created in 2016, has not launched any drug on the market but its clinical-stage pulmonary product using its mRNA platform is being tested as an inhalation treatment for cystic fibrosis in a Phase I / II clinical trial.
Report by Matthias Blamont in Paris; Additional reporting by Caroline Humer and Lewis Krauskopf in New York, Ankur Banerjee in Bengaluru and Sudip Kar-Gupta and Richard Lough in Paris; edited by Sonali Paul, Louise Heavens and Jason Neely
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