TIDMSYNC
RNS Number : 9052H
Syncona Limited
29 November 2022
Syncona Limited
Neogene to be acquired by AstraZeneca
29 November 2022
-- Agreement reached for Neogene Therapeutics to be acquired by
AstraZeneca for up to $320 million (GBP266 million [1] ) with an
upfront cash payment of $200 million (GBP166 million) and up to
$120 million (GBP100 million) in cash potentially due in both
contingent, milestones-based and non-contingent consideration
-- Syncona's ownership position in Neogene is 8% [2] with
upfront cash proceeds for Syncona at closing anticipated to be
GBP16 million, a 1.1 multiple of original cost and 5% IRR [3]
-- Future milestones have the potential of generating further
proceeds; if received in full Syncona's share of proceeds are
anticipated to be a further GBP6 million, taking total proceeds to
GBP22 million, a 1.6 multiple of original cost
-- Sale of Neogene strengthens the capital pool, enhancing
ability to fund companies in the portfolio to deliver next key
milestones and exciting pipeline of opportunities
Syncona Ltd, a leading healthcare company focused on creating,
building and scaling global leaders in life science, today
announces that an agreement has been reached to sell its portfolio
company Neogene Therapeutics, Inc. ("Neogene"), a biotechnology
company pioneering the discovery, development and manufacturing of
next-generation T cell receptor therapies, to AstraZeneca plc
("AstraZeneca"), a global, science-led biopharmaceutical company,
for up to $320 million (GBP266 million) on a cash and debt free
basis, with an upfront payment of $200 million (GBP166 million) and
up to $120 million (GBP100 million) potentially due in both
contingent, milestones-based and non-contingent consideration.
Syncona co-led the Series A financing of Neogene in 2020,
alongside global specialist investors. The company was founded in
2019 around the work of founders, Dr Ton Schumacher and Dr Carsten
Linnemann, and has been developing an engineered cell therapy
product for solid tumours based on a patient's own neoantigens. The
business has developed from a scientific concept to a rapidly
growing company and is well positioned to progress products through
the clinic.
On closing, the transaction is anticipated to result in cash
proceeds of GBP16 million for Syncona's holding in Neogene, a 1.1
multiple on Syncona's original cost of GBP14 million and an
internal rate of return (IRR) of 5%. In addition, the sale of
Neogene will potentially generate a further GBP6 million of
proceeds for Syncona, through future milestone payments, which if
received would take total proceeds to GBP22 million, a 1.6 multiple
on original cost.
On closing, this will mark the fourth sale of a Syncona
portfolio company over the last four years, generating total
potential proceeds of up to GBP1.2 billion, assuming full receipt
of milestones from the sales of Neogene and Gyroscope, an aggregate
5.6 multiple of cost [4] .
Martin Murphy, Chief Executive Officer and Chair of Syncona
Investment Management Limited, said: "In the two years since we
invested in Neogene, the company has built out an excellent team
and made strong operational progress, in an exciting, high
potential area of cell therapy where it remains complex to
manufacture and deliver products in routine practice. The business
is well positioned to progress its products through the clinic, and
we believe AstraZeneca, with deep expertise in oncology, is ideally
placed to realise the company's goal to bring cell therapies to
patients with solid tumours.
I would like to pass my congratulations to CEO Carsten Linnemann
and the broader management team and wish them well in their future
endeavours working within AstraZeneca.
Against a challenging market backdrop, we are delighted that we
will receive GBP16 million in proceeds from the sale of Neogene,
which we look forward to re-deploying into our portfolio companies
as they continue to scale and into our strong pipeline of exciting
new opportunities."
Transaction Terms
AstraZeneca will acquire all outstanding equity of Neogene
Therapeutics for a total consideration of up to $320m, on a cash
and debt free basis. This will include an initial payment of $200m
on deal closing, and a further $120m in both contingent,
milestones-based and non-contingent consideration.
The transaction is expected to close in the first quarter of
2023, subject to customary closing conditions and regulatory
clearances. Upon completion of the transaction, Neogene will
operate as a wholly owned subsidiary of AstraZeneca, with
operations in Amsterdam, The Netherlands, and Santa Monica,
California, USA.
[ENDS]
Copies of this press release and other corporate information can
be found on the company website at: www.synconaltd.com
Forward-looking statements - this announcement contains certain
forward-looking statements with respect to the portfolio of
investments of Syncona Limited. These statements and forecasts
involve risk and uncertainty because they relate to events and
depend upon circumstances that may or may not occur in the future.
There are a number of factors that could cause actual results or
developments to differ materially from those expressed or implied
by these forward-looking statements. In particular, many companies
in the Syncona Limited portfolio are conducting scientific research
and clinical trials where the outcome is inherently uncertain and
there is significant risk of negative results or adverse events
arising. In addition, many companies in the Syncona Limited
portfolio have yet to commercialise a product and their ability to
do so may be affected by operational, commercial and other
risks.
Enquiries
Syncona Ltd
Annabel Clark / Fergus Witt
Tel: +44 (0) 20 3981 7940
FTI Consulting
Ben Atwell / Natalie Garland-Collins / Julia Bradshaw / Tim
Stamper
Tel: +44 (0) 20 3727 1000
About Syncona
Syncona's purpose is to invest to extend and enhance human life.
We do this by creating and building companies to deliver
transformational treatments to patients in areas of high unmet
need.
Our strategy is to create, build and scale companies around
exceptional science to create a diversified portfolio of 20-25
globally leading healthcare businesses, across development stage
and therapeutic areas, for the benefit of all our stakeholders. We
focus on developing treatments for patients by working in close
partnership with world-class academic founders and management
teams. Our balance sheet underpins our strategy enabling us to take
a long-term view as we look to improve the lives of patients with
no or poor treatment options, build sustainable life science
companies and deliver strong risk-adjusted returns to
shareholders.
[1] FX rates taken at 28 November 2022
([2]) Syncona holding of Neogene is 7.9% on a fully diluted
basis; initial proceeds to Syncona take into account preference
rights on shares and the exercise of options/incentive shares in
Neogene
[3] Based on FX rates taken at 28 November 2022
[4] On closing of the transaction, the four sales will have
generated up-front cash proceeds of GBP948 million, at an aggregate
4.3 multiple of cost
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END
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