Almost a decade ago Emergent Biosciences thought Protein Sciences was worth $78m. That hostile bid was clearly worth fighting off, given the $650m that Sanofi has just laid on the table.
With a novel product on the market since 2013 and the vaccines space highly consolidated, it is perhaps surprising that the company has remained independent for so long. But then Protein Sciences has never relied on the sort of investor that demands a quick buck – something that has allowed it to take the long view.
The Conneticut group, which was founded in 1983, funded its earlier development work through US government biosecurity contracts and numerous licensing and partnering deals over its technology. It also received strategic investments from Pfizer and Johnson & Johnson, two of the world’s biggest vaccines players.
Notably these two groups never felt the need to integrate Protein's recombinant vaccine technology – or were not prepared to beat Sanofi’s price. In a press release announcing the deal the French phama giant said the acquisition would allow it to grow its flu vaccine portfolio with a novel non-egg based product, highlighting FDA approval of a quadrivalent version of Protein Science’s Flublok last year.
Protein Sciences cultures its vaccines in insect cells rather than eggs, a process that it claims is quicker and less expensive than traditional manufacturing systems. It is thus not reliant on egg production – and all the broader advantages this bestows – but the company argues that the benefits go further.
The “pure” proteins are made without infectious influenza virus, antibiotics, eggs, thimerosal, preservatives, gelatin or latex – important issues for certain sections of the population. The company has also tried to establish efficacy claims – last year it published a clinical study of 9,000 adults 50 years of age and older, which found that those who received Flublok Quadrivalent were over 40% less likely to get cell culture-confirmed influenza than those that received an egg-produced rival.
However, Sanofi might be looking beyond the flu vaccine. Protein Sciences’ technology can be turned to other therapeutics – it is based on the natural infection process of insect cells by baculoviruses, which the company re-engineers to generate the desired recombinant proteins.
As well as other prophylactic vaccines, Protein Sciences says the platform can be used to generate therapeutic cancer vaccines and gene therapies, using recombinant adeno-associated virus. Aside from Flublok two other products have progressed through phase III based on its platform, although both ultimately failed. Diamyd’s therapeutic vaccine for type I diabetes disappointed in phase III, while the gene therapy Glybera has recently been abandoned by its developer, even though it had received EU marketing approval.
These might not be shining examples of Protein Sciences’ technology, but oncology and gene therapy are areas in which Sanofi is interested. Sales of Flublok are not available, but it seems unlikely that the valuation reflects only this product.
It is not inconceivable that since Emergent’s unwanted land grab in 2008 there had been other approaches. But, from Protein Sciences’ point of view, putting in a decade’s more work has yielded a considerably bigger payday.