Gracell Biotechnologies – a global clinical-stage biopharmaceutical company dedicated to developing innovative cell therapies for the treatment of cancer and autoimmune diseases – recently announced it has entered into a definitive agreement to be acquired by AstraZeneca.
The proposed deal will enrich AstraZeneca’s growing pipeline of cell therapies with GC012F, a novel, clinical-stage FasTCAR-enabled BCMA and CD19 dual-targeting autologous chimeric antigen receptor T (CAR-T) cell therapy, a potential new treatment for multiple myeloma, and other haematologic malignancies and autoimmune diseases including systemic lupus erythematosus (SLE).
Autologous CAR-T is a type of cell therapy that was created by reprogramming a patient’s immune T cells to target disease-causing cells, and the manufacturing process for this type of treatment is complex and time-consuming. And Gracell’s FasTCAR next-day manufacturing platform significantly shortens manufacturing time, enhances T cell fitness, and will potentially improve the effectiveness of autologous CAR-T treatment in patients. The future applications of this technology may also include rare diseases.
Under the terms of the deal, AstraZeneca will acquire all of Gracell’s fully diluted share capital (including shares represented by ADSs) through a merger for a price of $2 per ordinary share in cash at closing (equivalent to $10 per ADS of the Gracell), plus a non-tradable contingent value right of $0.30 per ordinary share in cash (equivalent to $1.50 per ADS of the Gracell) payable upon achievement of a specified regulatory milestone.
The upfront cash portion of the consideration represents a transaction value of approximately $1 billion, a 62% premium to Gracell’s closing market price on December 22, 2023 and a 154% premium to the 60-day volume-weighted average price (VWAP) of $3.94 per ADS before this announcement. Combined, the upfront and potential contingent value payments represent (if achieved), a transaction value of approximately $1.2 billion, an 86% premium to Gracell’s closing market price on December 22, 2023 and a 192% premium to the 60-day VWAP. As part of the proposed deal, AstraZeneca will acquire the cash, cash equivalents and short-term investments remaining on Gracell’s balance sheet, which totaled $234.1 million as of September 30, 2023.
The deal is expected to close in the first quarter of 2024, subject to customary closing conditions, including regulatory clearances and Gracell shareholder approval. If completed, the transaction will result in Gracell becoming a privately held company, and its ADSs will no longer be listed on the Nasdaq.
Centerview Partners is acting as the exclusive financial advisor to Gracell. And Cooley LLP is acting as legal advisor to Gracell. AllBright Law Offices is acting as PRC legal advisor to Gracell, and Harney Westwood & Riegels is acting as Cayman Islands legal advisor to Gracell.
Freshfields Bruckhaus Deringer US LLP is acting as legal advisor to AstraZeneca. And RuiMin is acting as PRC legal advisor to AstraZeneca, and Maples Group is acting as Cayman Islands legal advisor to AstraZeneca.
KEY QUOTES:
“We look forward to working with AstraZeneca to accelerate our shared goal of bringing transformative cell therapies to more patients living with debilitating diseases. By combining our expertise and resources, we can unlock new ways to harness the Gracell’s FasTCAR manufacturing platform, which we believe has the potential to optimize the therapeutic profile of engineered T cells to pioneer the next generation of autologous cell therapies.”
- William Cao, founder, Chairman and CEO, Gracell
“The proposed acquisition of Gracell will complement AstraZeneca’s existing capabilities and previous investments in cell therapy, where we have established our presence in CAR-T and T-cell receptor therapies (TCR-Ts) in solid tumors. GC012F will accelerate our cell therapy strategy in hematology, with the opportunity to bring a potential best-in-class treatment to patients living with blood cancers using a differentiated manufacturing process, as well as exploring the potential for cell therapy to reset the immune response in autoimmune diseases.”
- Susan Galbraith, Executive Vice President, Oncology R&D, AstraZeneca
