When companies cooperate, it often becomes cumbersome.
Everyone wants to do it differently, and who actually decides?
The French pharmaceutical company Sanofi is now making short work of the important development area of mRNA technology and is buying its cooperation partner, the American biotech company Translate Bio, without further ado.
Christian Schubert
Business correspondent in Paris.
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That Sanofi is spending $ 3.2 billion on it shows how this technology is at the center of attention today. Translate Bio is a small company in Lexington, Massachusetts, employs around 160 people and posted a loss of $ 54 million last year on sales of $ 139 million. But what the bottom line comes from in economic terms is not the decisive factor for young growth companies. The most important item is research and development spending, which at Translate Bio was $ 110 million last year, almost as high as sales.
Sanofi believes the research effort will produce good results. Otherwise the French company would not offer Translate Bio shareholders a premium of 60 percent on the average price of the past 60 days at 38 dollars per share. Translate Bio bought its mRNA platform from the British Shire group in 2017. The cooperation with Sanofi began in 2018, but the companies are lagging far behind the market leaders Biotech and Moderna in the fight against Covid-19.
The test results of phases one and two (of three phases) are expected by Sanofi and Translate Bio in the third quarter of 2021. They are also cooperating on a flu vaccine based on mRNA technology and expect the first test results towards the end of the year. Moderna is also currently developing such a flu vaccine. Sanofi is also working with British competitor GSK on a “classic” vaccine against Covid-19, which could be approved in the fourth quarter of 2021 if the current tests in the third development phase are successful.
The acquisition of Translate Bio is intended to accelerate research and development, Sanofi announced on Tuesday.
A few weeks ago, the group announced that it would set up a “center of excellence” for mRNA vaccines in the United States and France.
In April, Sanofi bought the small biotech company Tidal Therapeutics in Cambridge, Massachusetts, for a price that can reach up to $ 310 million depending on development progress.
The French group is hoping for broad use not only against Covid, but also in immunology, oncology and rare diseases, as Sanofi CEO Paul Hudson emphasized.
Translate Bio conducts research into the treatment of the metabolic disease cystic fibrosis, various lung diseases and hepatitis.
Translate Bio's CEO, Ronald Renaud, and its main shareholder, The Baupost Group, support the French takeover bid. Together with the minority shares that Sanofi already holds, this corresponds to 30 percent of Translate Bio shares. The French group wants to finance the takeover from its liquid funds. The companies expect the transaction to close in the third quarter of this year.