Geneva — French drugmaker Sanofi is strengthening its pact with US vaccine developer Translate Bio to develop shots for Covid-19 and the flu in a deal that could be valued at as much as $2.3bn.

Sanofi will pay $425m upfront, the companies said on Tuesday. The French company also agreed to pay as much as $1.9bn on meeting various goals, plus royalties.

Translate Bio and Sanofi formed an alliance and licence agreement in 2018 to develop mRNA vaccines for infectious diseases. The companies are studying several vaccine candidates for Covid-19, aiming to start a clinical trial in the fourth quarter of 2020.

The Paris-based drugmaker announced plans earlier this month to invest €610m boosting its vaccine business with two new production and research centres in its home market.

Messenger RNA technology is a new approach that tries to defeat a pathogen by injecting ribonucleic acid into the body that then teaches cells to identify and attack the coronavirus.

Sanofi will get worldwide rights for infectious disease vaccines developed in the pact. The companies are also working on shots for influenza and other pathogens.

The upfront payment consists of $300m in cash and the purchase of $125m worth of shares at a price of $25.59 each. That’s 58% higher than Monday’s closing price.

About $360m of the milestone payments are anticipated over the next several years, with the bulk available after that. 


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