This is how AstraZeneca will increasingly focus on China
AstraZeneca has concluded an agreement to acquire Gracell Biotechnologies, a Chinese company specializing in cell therapies for the treatment of cancer and autoimmune diseases. But it's only the last one this year. All the details
After Moderna, AstraZeneca is also looking to the East and to China in particular. In fact, yesterday the Anglo-Swedish pharmaceutical company announced that it will buy the Chinese Gracell Biotechnologies for a maximum value of 1.2 billion dollars with the dual aim of expanding its ambitions in the field of cell therapies and strengthening its presence in the country.
Already last August , AstraZeneca struck a deal with CanSino to produce an mRNA vaccine, and Reuters described it as the largest foreign pharmaceutical company in China.
THE PURCHASE OF GRACELL BIOTECHNOLOGIES
Under the terms of the agreement, AstraZeneca will acquire all of the equity capital of Gracell Biotechnologies through a merger for a price of $2.00 per common share or $10 per American Depository Share, representing a 61.6% premium from its last closing on December 22nd. Shareholders will also receive a non-negotiable contingent value right of $0.30 per common share if certain regulatory milestones are achieved.
As reported by the two companies, the upfront payments and potential contingent value, if achieved, represent a transaction value of approximately $1.2 billion, an 86% premium to Gracell Biotechnologies' closing market price on the 22nd December 2023 and a 192% premium to the 60-day VWAP.
The transaction is expected to close in the first quarter of 2024, and AstraZeneca said it will not impact its financial forecast for 2023.
Gracell Biotechnologies will operate as a wholly owned subsidiary of the Anglo-Swedish company, with operations in China and the United States.
WHAT GRACELL BIOTECHNOLOGIES DOES
Gracell Biotechnologies is a biopharmaceutical company developing innovative cell therapies for the treatment of cancer and autoimmune diseases. Its acquisition will enrich AstraZeneca's cell therapy pipeline with an innovative therapy, currently in the clinical phase, which represents a new potential cure for multiple myeloma, as well as other hematological malignancies and autoimmune diseases, including systemic lupus erythematosus (SLE ).
This type of therapy called CAR-T, explains AstraZeneca, is created by reprogramming the patient's immune T cells to target the cells that cause tumors and it is hypothesized that its future applications could also include rare diseases.
ASTRAZENECA'S PASSION FOR CHINA
As the Guardian recalls, the acquisition, in addition to being a further investment in cancer research and treatment, which represents around a third of AstraZeneca's activities, is a sign of its continued expansion in China. The company, which is one of the largest publicly traded companies in London, last year made 13% of its revenues – about $6 billion out of $44 billion – in the country, making it the second most profitable market after the United States , where revenues totaled $18 billion.
It is therefore no coincidence that its CEO, Pascal Soriot, has already declared his desire to exploit the medical innovation of China, which is conducting clinical trials on CAR-T therapies more than anyone else.
The country's growing importance to the Cambridge-based company was already evident this summer, when it emerged that it was considering spinning off its local operations and listing them in Hong Kong or Shanghai, to avoid being caught up in the fallout of growing tensions between China and the United States and its allies.
AstraZeneca, the British newspaper points out, is not only trying to exploit a growing customer base in China, but is increasingly entering into agreements with local companies that can expand its drug offering in other markets. The acquisition of Gracell Biotechnologies, in fact, is the second agreement with a Chinese company in the space of two months, after the one in November with Eccogene for the development of a weight loss pill .
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/ecco-come-astrazeneca-puntera-sempre-piu-sulla-cina/ on Wed, 27 Dec 2023 11:04:58 +0000.