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Glaxo to Invest Up to $1 Billion in CureVac Vaccine Pact

Glaxo to Invest Up to $1 Billion in CureVac Vaccine Pact

GlaxoSmithKline Plc agreed to work with Germany’s CureVac on as many as five novel mRNA vaccines that will target infectious diseases as Covid-19 prompts companies and governments to focus on future pandemic threats.

The British pharmaceutical giant will spend as much as 840 million pounds ($1 billion), including a 130 million-pound equity investment in CureVac, to find and develop mRNA vaccines and monoclonal antibodies, the company said on Monday. Messenger RNA is a technology that spurs the body to create specific proteins with its own cells, allowing the immune system to combat disease.

While CureVac is a player in the race for a coronavirus vaccine, the German company’s existing Covid-19 mRNA and rabies vaccines research programs are not included in the partnership. The German government bought a stake worth 300 million euros ($344 million) in the biotech company in June, after speculation the U.S. was looking to buy the business or its technology.

Glaxo has a long history in vaccines, which accounted for more than 7 billion pounds in sales last year. The company is also among a number of developers pursuing potential Covid-19 jabs, working with France’s Sanofi in a bid to have a successful vaccine candidate available in 2021. The duo have been discussing a 500 million-pound deal to supply the U.K. government with the shot.

The company is keen to speed up the development of new shots, a journey that can take 15 years. Glaxo sees an opportunity to do it in half as much time partly by harnessing new technologies that enhance the immune system’s response to vaccines, Emmanuel Hanon, its research and development head, said in an interview last year.

Additional payments include 104 million pounds upfront and up to 606 million pounds tied to milestones. CureVac also could receive royalties on product sales. The investment in CureVac represents a stake of about 10% in the company.

CureVac Chief Financial Officer Pierre Kemula said in an interview last month that the company was considering an initial public offering. Other companies trying to develop coronavirus vaccines, including Moderna Inc. and BioNTech SE, are already public.

©2020 Bloomberg L.P.