(Yicai) Dec. 27 -- Shares of Gracell Biotechnologies surged yesterday after UK-Swedish pharmaceutical giant AstraZeneca announced it would invest USD1.2 billion to acquire the Chinese biopharmaceutical company.

Gracell Biotechnologies [NASDAQ: GRCL] closed 60.3 percent up at USD9.92 in New York yesterday.

AstraZeneca entered into a definitive agreement to acquire Gracell Biotech as early as in the first quarter of next year to further its cell therapy ambition, the Cambridge-based company said in a statement yesterday.

“The acquisition will enrich AstraZeneca’s growing pipeline of cell therapies with GC012F, a novel, clinical-stage FasTCAR-enabled BCMA, and CD19 dual-targeting autologous chimeric antigen receptor T-cell therapy, a potential new treatment for multiple myeloma, and other hematologic malignancies and autoimmune diseases including systemic lupus erythematosus,” AstraZeneca noted.

Autologous CAR-T is a type of cell therapy created by reprogramming a patient’s immune T cells to target disease-causing cells, and the manufacturing process for this type of treatment is complex and time-consuming. Gracell Biotech’s FasTCAR platform significantly shortens manufacturing time, enhances T cell fitness, and will potentially improve the effectiveness of autologous CAR-T treatment in patients, AstraZeneca pointed out.

“The acquisition of Gracell Biotech will complement AstraZeneca’s existing capabilities and previous investments in cell therapy, where we have established our presence in CAR-T and T-cell receptor therapies in solid tumors,” said Susan Galbraith, AstraZeneca’s executive vice president.

“GC012F will accelerate our cell therapy strategy in hematology, with the opportunity to bring a potential best-in-class treatment to patients living with blood cancers using a differentiated manufacturing process, as well as exploring the potential for cell therapy to reset the immune response in autoimmune diseases,” Galbraith added.

The transaction price represents an 86 percent premium over Gracell Biotech’s closing market value on Dec. 22, AstraZeneca added, noting that the target firm had USD234 million worth of cash equivalents and short-term investments on its balance sheet as of Sept. 30.

Once the acquisition is completed, Gracell Biotech will be delisted from the New York Stock Exchange’s technology board Nasdaq, and become a wholly-owned unit of AstraZeneca, the buyer pointed out. Gracell Biotech will become the first Chinese pharmaceutical company to be wholly acquired by a multinational corporation.

Gracell Biotech has very good clinical data but no products on sale, meaning that it lacks the ability to generate products by itself, thus it is not recognized by the secondary market, an industry insider said. However, a multinational like AstraZeneca is still willing to acquire Gracell Biotech, given its manufacturing process and indications layout, the insider noted.

The considerations are relatively fair for both Gracell Biotech and AstraZeneca, a senior pharmaceutical market investor told Yicai.

Editors: Zhang Yushuo, Futura Costaglione