New York: Valneva SE, a specialty vaccine company, and Pfizer Inc. have announced that they have entered into an Equity Subscription Agreement and have updated the terms of their Collaboration and License Agreement for Lyme disease vaccine candidate VLA15. As previously announced on April 26, 2022, Pfizer plans to initiate the Phase 3 study of VLA15 in the third quarter of 2022.
As part of the Equity Subscription Agreement, Pfizer will invest €90.5 ($95) million in Valneva, representing 8.1% of Valneva’s share capital at a price of €9.49 per share, through a reserved capital increase to further support the strategic Lyme partnership between the two companies. The per share purchase price was determined based on the average closing price of the Company’s Shares on Euronext Paris during the 10 trading days preceding the date of the Equity Subscription Agreement. The equity investment is due to close on June 22, 2022. Valneva is planning to use the proceeds from Pfizer’s equity investment to support its Phase 3 development contribution to the Lyme disease program.
In addition, Valneva and Pfizer updated the terms of their collaboration and license agreement which they announced on April 30, 2020. Valneva will now fund 40% of the remaining shared development costs compared to 30% in the initial agreement. Pfizer will pay Valneva tiered royalties ranging from 14% to 22%, compared to royalties starting at 19% in the initial agreement. In addition, the royalties will be complemented by up to $100 million in milestones payable to Valneva based on cumulative sales. Other development and early commercialization milestones are unchanged, of which $168 million remain, including a $25 million payment to Valneva upon Pfizer’s initiation of the Phase 3 study.
Thomas Lingelbach, Chief Executive Officer of Valneva, commented “Pfizer’s investment in Valneva highlights the quality of the work that we’ve done together over the past two years and is a strong recognition of Valneva’s vaccine expertise. This subscription agreement will contribute to our investment in the Phase 3 study while limiting the impact on our cash position. Lyme disease is spreading and represents a high unmet medical need which impacts the lives of millions of people in the Northern Hemisphere. We are looking forward to further investigating our VLA15 candidate in Phase 3, which will take us a step closer to potentially help protect both adults and children from this devastating disease.”
“Lyme disease continues to place a heavy burden on countries in North America and Europe, with an estimated 600,000 cases each year across both regions,” said Kathrin U. Jansen, Ph.D., Senior Vice President and Head of Vaccine Research & Development at Pfizer. “As the geographic footprint of Lyme disease widens, the medical need for vaccination becomes even more imperative.We are excited to continue partnering with Valneva on the development of VLA15 and look forward to working together to progress the program with the goal of bringing forward a vaccine that could help prevent this debilitating disease.”
Pending successful initiation and completion of the planned Phase 3 study for VLA15, Pfizer could potentially submit a Biologics License Application (BLA) to the U.S. Food and Drug Administration as early as 2025.
The 9,549,761 new ordinary shares to be issued to Pfizer pursuant to the Equity Subscription Agreement will represent a dilution of approximately 8.1% of the share capital of the Company. On an illustrative basis, a shareholder holding 1% of Valneva’s capital before this capital increase will now hold a stake of 0.919%.