Twice over the last year, Sanofi has come up short in high-stakes attempts at top M&A prospects. Now, the drugmaker has finally bagged an acquisition, though not on the scale of its runs for Medivation or Actelion.
Sanofi said on Tuesday that it's picking up Connecticut-based flu vaccine maker Protein Sciences in a deal worth $650 million up front and another $100 million in potential follow-up payments. The maker of the Flublok Quadrivalent influenza vaccine will add to Sanofi’s portfolio in a market it currently leads.
Flublok is the only FDA-approved recombinant protein-based flu vaccine, according to Sanofi. The vaccine is made from insect cells in an egg-free process, but the biotech has been hoping to get away from the “absolute fable” that the vaccine is only for people with egg allergies, CEO Manon Cox previously told FiercePharma.
"We believe that Flublok Quadrivalent is really going to be the product of choice in time," she said when the vaccine won FDA approval. "Even influenza vaccine manufacturers are recognizing that, over time, the egg-based production process will become obsolete and will be replaced with a more modern production process." With Flublok Quadrivalent’s approval last fall, privately held Protein Sciences joined the likes of Big Pharma players Sanofi, GlaxoSmithKline, AstraZeneca and Seqirus in offering quadrivalent flu vaccines.
Cox said in a statement on Tuesday that she expects the company’s shot to “benefit from Sanofi Pasteur’s expertise in the field of influenza vaccines.” Protein Sciences previously had trouble breaking into the trivalent market.
Flublok Quadrivalent contains three times as much active ingredient as other quadrivalent options, according to Protein Sciences. It’s approved for people 18 and older. The biotech’s board unanimously approved the acquisition, and the deal is expected to close in the third quarter.
The deal follows Sanofi's failed runs at cancer drugmaker Medivation, which sold to Pfizer for $14 billion last summer, and at Actelion. That drugmaker ended up going to Johnson & Johnson in a two-part $30 billion deal in January, the largest in biopharma so far this year.
Aside from its quadrivalent business, Protein Sciences is working with the Department of Health and Human Services' BARDA organization on contracts for national pandemic influenza preparedness and on avian influenza vaccine candidates. It also has preclinical programs targeting Zika and SARS.
Sanofi currently holds the top position in the flu vaccine market, with €1.5 billion in sales around the world last year. GSK sold £414 million worth of quadrivalent flu shots over the same period. After picking up Novartis’ flu vaccine offerings, Australia’s CSL formed flu unit Seqirus, currently the second-largest flu vaccine player. In CSL’s most recent annual report for the year ended June 2016, the company disclosed that Seqirus generated $652 million in 11 months of sales.
AstraZeneca offers the quadrivalent FluMist nasal vaccine, but that shot has suffered lately from a Centers for Disease Control and Prevention committee’s recommendation against its use in the U.S. The committee questioned the vaccine's efficacy for the second season in a row.