Jan 24, 2024 - Health

Biopharma M&A streak continues with Sanofi deal

Illustration of a grid consisting of colorful rectangles, the back of a one hundred dollar bill, and photographs of a prescription pill bottle, a microscope, and a hand holding a molecular genetics testing tray.

Illustration: Gabriella Turrisi/Axios

The surge of health care dealmaking continued Tuesday as Sanofi announced it would buy the San Diego-based biotech Inhibrx and spin off most of its assets into a new company in a transaction worth as much as $2.2 billion.

Why it matters: Stabilizing interest rates, patent cliffs and the need to replenish pipelines have created an environment for more drugmaker consolidation.

  • Johnson & Johnson, AstraZeneca and Bristol Myers Squibb have all announced multibillion-dollar deals in recent weeks.

Driving the news: Sanofi is focusing on Inhibrx's INBRX-101, an experimental drug that treats a rare inherited disease called alpha-1 antitrypsin deficiency that primarily affects the lungs.

  • The move is part of the French drugmaker's broader push to move away from over-the-counter products and to focus on novel treatments.
  • Sanofi will spin out Inhibrx's non-INBRX-101 assets — including three experimental cancer drugs — into a new publicly traded company and retain an 8% equity stake.

The big picture: It's the sixth proposed drugmaker buyout already this year, per a BioPharma Dive tracker, and comes after industry deal values rose more than 35% last year, according to data from the London Stock Exchange Group.

  • Analysts expect continued interest in small and medium-sized capitalization biotechs with drugs in late-stage trials.
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