AstraZeneca will buy a Chinese biopharmaceutical company for up to $1.2 billion to expand its cell therapies pipelines, the Anglo-Swiss pharmaceutical company announced on Tuesday.
It has entered into a definitive agreement to acquire Gracell Biotechnologies Inc. for $2 per ordinary share plus a non-tradable contingent value right of $0.3 per ordinary share.
In total, the upfront payment is around $1 billion, with some $0.2 billion payable if specified regulatory milestones are reached.
The transaction is expected to close in the first quarter of 2024, AstraZeneca said.
Once the transaction is complete, Gracell will be delisted from the NASDAQ Biotechnology Index and operate as a wholly owned subsidiary of AstraZeneca, with operations in China and the United States.
Established in 2017, Gracell boasts of a FasTCAR platform that accelerates the process of CAR-T-cell therapy which targets disease-causing cells by reprogramming a patient’s immune T-cells.
AstraZeneca said the proposed acquisition “will enrich AstraZeneca’s growing pipeline of cell therapies.”
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 as Novartis and Gilead.
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.
In September, Leon Wang, executive vice president, international and China president of AstraZeneca, told China Business Network that the company was actively looking for partners.
“AstraZeneca scientists kept visiting China, there are around five to 10 scientists currently scouring for projects in China,” he said at the time.
