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Sanofi announced that it had agreed to buy California-headquartered biotechnology firm Synthorx in a cash deal worth about $2.5 billion.
French multinational company Sanofi SA stated on Monday that it will buy biotechnology company Synthorx Inc. for a combined equity value of approximately $2.5 billion. In other words, it will be $65 per share.
The acquisition is expected to close in the first quarter in 2020 and the company believes it will strengthen Sanofi’s existing immuno-oncology portfolio.
Paul Hudson, who is the CEO of Sanofi, said:
“This acquisition fits perfectly with our strategy to build a portfolio of high-quality assets and to lead with innovation, as you will hear at our Capital Markets Day tomorrow, December 10. Additionally, it is aligned with our goal to build our oncology franchise with potentially practice-changing medicines and novel combinations.”
John Reed, Global Head of Research & Development at Sanofi explained that Synthorx’s exceptionally novel discovery platform has already created a molecule that has a possibility to become a foundation of the next generation of immuno-oncology combination therapies.
As per the statement, Synthorx’s Expanded Genetic Alphabet platform will become a source for developing a differentiated therapeutic pipeline. Individually and in together with other existing Sanofi platforms, including the Nanobody technology, the platform will utilize the company to spread novel biologics.
President and Chief Executive Officer at Synthorx, Laura Shawver, stated:
“Importantly, Sanofi has a portfolio of therapeutics that holds incredible promise for combining with our cytokine Synthorins to benefit patients around the world. I want to thank our employees and the Sanofi organization for their relentless efforts on behalf of patients.”
Morgan Stanley will be a financial advisor to Sanofi and Weil, Gotshal & Manges LLP is its legal counsel.
Centerview Partners LLC is an exclusive financial advisor to Synthorx and Cooley LLP is acting as its legal counsel.
The French pharma giant confirmed earlier this year that it would hurry up 17 drug programs, almost half concerning cancer issues, but also to drop more than a dozen others under development.
Analysts at HSBC wrote in August that more deals would be the quickest way to establish Sanofi’s spot of medicines and profile in cancer. Sanofi and partner Regeneron Pharmaceuticals Inc. last year got approved an immune-oncology drug, Sanofi’s debut, for a deadly form of skin cancer.
Meanwhile, Sanofi shares have climbed about 11% since Chief Executive Officer Paul Hudson was named CEO in June, closing at 82.85 euros on Friday. The stock had declined almost 16% over the last four years.
Previously, Sanofi wanted to widen its base beyond diabetes and cardiovascular drugs, which have seen recently increased competition. Last year, it spent $11.6 billion for the hemophilia-focused Bioverativ and $4.8 billion for the nanobody biotech Ablynx.