British pharmaceutical firm AstraZeneca has agreed to acquire Icosavax, a US-based biopharmaceutical company focused on vaccine development, for about $1.1bn.

Under the terms of the agreement, AstraZeneca, through its subsidiary, will acquire all the outstanding shares of Icosavax common stock at $15 per share in cash.

The British drugmaker will also purchase a non-tradable contingent value right for up to $5 per share, contingent on specified regulatory and sales milestones.

The upfront cash portion of the consideration amounts to nearly $0.8bn, and when combined with the maximum potential contingent value, brings the total transaction value to about $1.1bn.

Also, AstraZeneca will acquire the cash and marketable securities on Icosavax’s balance sheet worth $229m, as of 30 September 2023.

The closing of the tender offer is subject to certain conditions, including the tender of majority Icosavax shares, and other customary closing conditions and regulatory approvals.

Upon the completion of the tender offer, AstraZeneca’s acquisition subsidiary will be merged with Icosavax and any remaining Icosavax shares will be converted into the right.

The acquisition is anticipated to be completed in the first quarter of 2024, subject to satisfaction of conditions in the merger agreement.

AstraZeneca vaccines and immune therapies executive vice president Iskra Reic said: “This virus-like particle vaccine technology has the potential to transform prevention against severe infectious diseases, including RSV and hMPV.

“With the addition of Icosavax’s Phase III-ready lead asset to our late-stage pipeline, we will have a differentiated, advanced investigational vaccine, and a platform for further development of combination vaccines against respiratory viruses.

“This aligns with our strategy to deliver a portfolio of therapies to address high unmet needs in infectious diseases, and our ambition to protect the most vulnerable patients who have a high risk of severe outcomes.”

Icosavax develops vaccines against infectious diseases using its advanced protein virus-like particle (VLP) platform technology, with an initial focus on respiratory diseases.

AstraZeneca said that the acquisition will strengthen its vaccines and immune therapies pipeline with Icosavax’s lead investigational vaccine candidate IVX-A12.

IVX-A12 is a combination protein VLP vaccine that targets both RSV and human metapneumovirus (hMPV), two leading causes of severe respiratory infection.

The refrigerator-stable formulation comprises Icosavax’s RSV prefusion F protein VLP vaccine candidate IVX-121 and hMPV prefusion F protein VLP vaccine candidate IVX-241.

IVX-A12 showed superior immune responses across RSV and hMPV antibodies in a Phase 2 trial, confirming previous immunogenicity data from the smaller Phase 1 trial.

The experimental vaccine candidate has received the US Food and Drug Administration (FDA) Fast Track Designation, intended for the review of new drugs to treat serious conditions.

Icosavax CEO Adam Simpson said: “We are pleased to announce the proposed acquisition of Icosavax by AstraZeneca as we believe it offers the opportunity to accelerate and expand access to our potential first-in-class combination vaccine for older adults at risk of RSV and hMPV.

“We look forward to combining our skills and expertise in advancing the development of IVX-A12 with AstraZeneca’s decades of experience in RSV, resources, and capabilities in late-stage development.”