AstraZeneca said it will buy Gracell Biotechnologies for up to $1.2 billion as the Anglo-Swedish pharma company furthers its cell therapy ambitions and boosts its presence in China, the world’s second-largest pharmaceuticals market.
The cash deal, which adds several experimental therapies to AstraZeneca’s portfolio, values Gracell at $2 per ordinary share, or $10 per American Depository Share, of Gracell, representing a premium of 61.6% from its last close on Dec. 22.
The shareholders will also receive a non-tradable contingent value right of $0.30 per ordinary share, if certain regulatory milestones are met.
Shares of China-headquartered Gracell surged 60% in premarket trading in the United States.
Gracell’s CAR-T cell therapy works by extracting disease-fighting white blood cells known as T-cells from a patient, re-engineered to attack cancer and infused back into the body.
H.C. Wainwright analyst Emily Bodnar said this could be AstraZeneca’s way of getting more into cell therapy as it is not as heavily involved in the space like Novartis and Gilead.
AstraZeneca will also acquire Gracell’s cash, cash equivalents and short-term investments of $234.1 million as of Sept. 30, 2023. The deal is expected to close in the first quarter of 2024, according to the statement.
AstraZeneca, one of the biggest drugmakers in China, had drafted plans to spin off its business in the region, according to media reports in June.
Last month, AstraZeneca agreed to a licensing deal for an experimental anti-obesity pill from China’s Eccogene, and in August it announced a contract manufacturing deal with CanSino Biologics for its messenger RNA technology vaccine program.
AstraZeneca signed three licensing deals with Chinese companies, CEO Pascal Soriot said earlier this year.
Source: Reuters.com