Sanofi inks $3.2B Translate buyout to get deeper into mRNA R&D

Sanofi has struck a deal to buy its mRNA partner Translate Bio in a $3.2 billion deal. News of the deal comes weeks after Sanofi revealed plans to reallocate $476 million a year to a new mRNA Center of Excellence.

The French Big Pharma’s interest in mRNA predates the pandemic—it paid $45 million upfront to first team up with Translate in 2018—but its focus on the modality has intensified since the crisis began to validate the power of the technology. Sanofi paid Translate $425 million to expand the 2018 pact in the early months of the pandemic and has now decided to buy its partner outright. 

Sanofi framed the acquisition as a way to accelerate the programs it licensed from Translate and the establishment of its mRNA Center of Excellence. The partners have mRNA vaccines for COVID-19 and influenza in the clinic, and programs targeting other viral and bacterial pathogens in discovery.

Bringing those programs in-house cements Sanofi’s position as a competitor in the nascent mRNA space. While Moderna and Pfizer-BioNTech are dominating the COVID-19 part of the market, Sanofi and Translate became the first companies to start testing a seasonal mRNA flu vaccine in humans earlier this year. That trial is testing a monovalent vaccine, but a quadrivalent version is in the works.

Buying Translate will also give Sanofi ownership of programs outside of the scope of its alliance with the biotech, including a cystic fibrosis candidate that delivered phase 1/2 data earlier this year. The data underwhelmed investors. Sanofi only briefly mentioned the program in its statement to disclose the planned takeover. 

Translate has accepted a $38 a share cash offer from Sanofi. Shares in Translate were trading around $29 yesterday, but shot up to $50 in after-hours trading on the back of media reports that a Sanofi deal was close. The reports lacked financial terms. 

Sanofi previously acquired Tidal Therapeutics for $160 million upfront, plus up to $310 million in milestones. The Tidal takeover gave Sanofi mRNA research capabilities in immuno-oncology and inflammatory diseases. 

Through the deals, Sanofi has established itself as one of the leading Big Pharma companies in a mRNA space previously dominated by well-financed biotechs; although, with Novartis’ chairman saying “every research company is questioning whether they should invest more in this area,” it could be joined by more of its peers in the future.

Sanofi’s early, committed move into mRNA is in keeping with the push by CEO Paul Hudson to make the company a more effective R&D machine and lessen its reliance on external partners. 

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