Launch of Oxford-AstraZeneca Covid-19 vaccine in conflict with the University ahead of planned IPO

Oxford, nine hundred years old, is struggling to rewrite its rules to promote companies created by its academics or born in its labs, while facing a confrontation that has been put in the spotlight. by the pandemic. The startup, Vaccitech Ltd., launched potential investors and laid the groundwork for a list of shares in New York as early as this year, according to people close to the marketing plans and documents reviewed by The Wall Street Journal.

Investors are targeting an IPO valuation of about $ 700 million, with Vaccitech expected to be a $ 1 billion company by the end of the year. Large investors such as the pharmaceutical giant Gilead Sciences Inc.

and Lilly Asia Ventures, a venture capital firm derived from drugmaker Eli Lilly & Co., have expressed interest in investing, according to people familiar with the issue and documents reviewed by the Journal.

Vaccitech chief executive Bill Enright declined to comment, as did a Gilead spokesman. Lilly Asia Ventures did not respond to a request for comment.

Vaccitech is among a handful of once obscure biotechnologies that have found their moment of opportunity in the pandemic. However, Vaccitech has not yet capitalized on its role. Some investors have been nervous about the high-profile stumbling blocks in launching the shot and the early negative perceptions about its effectiveness compared to other vaccines.

There is another problem. The long-running tensions between the startup and Oxford have raised new obstacles in the complex fundraising process, according to people familiar with the matter. Plans for an IPO are still in place and may continue to fall apart, these people said.

The university owns about 10% of the startup. Vaccitech, its bankers and lawyers have sought access, so far without success, to Oxford’s exclusive Covid-19 vaccine contract with AstraZeneca, according to these people. The pact was concluded last spring, when the doctor agreed to make and distribute the Oxford vaccine. Vaccitech and its advisers argued that the document specifies the financial and legal obligations that are essential for the proper valuation of the company and for the disclosure of regulations.

These people say that Oxford and Vaccitech are facing separate accounts of the company’s role in vaccine development. Vaccitech wants Oxford printers to market early scientists’ work with Oxford in inventing the vaccine and assisting it in accelerating production for early clinical trials and providing safety data for regulators, according to people familiar with the issue and related correspondence viewed by Jurnal. The two sides also briefly clashed over the listing, with some Oxford-affiliated investors favoring London. Vaccitech executives insisted on the Nasdaq in New York.

Oxford did not respond to requests for comment. AstraZeneca declined to comment.

Prior to Covid-19, Vaccitech was a little-known start-up biotech, focused in part on vaccines – a low-profile field until last year. Oxford support helped keep the company afloat. The Covid-19 image has given new credence to Vaccitech’s own suite of vaccines and therapies, still in clinical trials, designed to fight other viruses and cancers.

The conflict unfolds as Oxford seeks to review the way it supports startups such as Vaccitech, which seeks to turn science and technology into shareholder profitability. The repair is part of Oxford’s years of trying to compete better with top American schools, such as the Massachusetts Institute of Technology and Stanford University, to attract money and talent for the startup.

Vaccitech was co-founded in 2016 by two scientists from Oxford, now at the center of vaccine development. They created a key technology that underpinned the shooting, using a cold chimpanzee virus modified to carry genetic material into human cells to trigger immunity. Vaccitech owns rights to this technology.

Executives and investors say the Covid-19 blow has shown the potential of Vaccitech technology to fight hepatitis B, prostate cancer and human papillomavirus – global health issues with huge markets for effective treatments. Vaccitech scientists believe that the so-called viral vector technology used in the Covid-19 vaccine can unlock other therapies and weapons against infections, some of which could license large pharmaceutical companies.

Studies in humans of the Oxford-AstraZeneca shot last year – and real-world evidence from then – have shown that it worked against Covid-19, preventing deaths and serious illness. But studies have also generated a confusing spectrum of results that have created negative perceptions about its effectiveness compared to other vaccines. AstraZeneca has also been on the defensive in terms of deficiencies in the doses it has said it will deliver to Europe by this month.

Other biotechnology companies behind Covid-19 vaccines have attracted gold for fundraising. CureVac NV in Germany raised over $ 200 million in a stock debut in August, which valued it at over $ 2 billion. This has risen well over $ 15 billion since his vaccine reached final study. Shares of Novavax Inc.,

which has struggled for years to produce a marketable vaccine, have grown as it closes with the US authorization of the Covid-19 vaccine.

Vaccitech has waived direct rights to the Oxford Covid-19 vaccine and instead intends to make 24% of the royalties Oxford receives from sales of AstraZeneca vaccines, the Journal reported earlier.

The value of Vaccitech is largely based on the potential future royalties from the Covid-19 vaccine, but much more on its plans to adapt the vaccine technology to fight other diseases. This drug pipeline needs at least another three to four years to bear fruit, according to marketing documents. Investors previously valued the company at about £ 100 million, the equivalent of $ 138.4 million, but now estimate it to be worth more than $ 250 million, according to updated, non-public figures.

Vaccitech’s IPO plans are shaping up as a test case for the Oxford spinout process. The university has supported more than 200 startups since the late 1980s, but its record of encouraging large money factors has followed American leadership institutions. Now, the British university is ceasing its current rules, according to unpublished communications reviewed by the Journal and people familiar with the process.

In 2015, Oxford created its own venture firm, Oxford Sciences Innovation PLC, raising about $ 800 million from outside investors. Oxford owns 5% of OSI and aims to take a 50% stake in promising startups, automatically offering half of this to OSI. Since then, Oxford has reduced its founding stakes by about 28% on average and is trying to reduce this for future businesses, say people close to the process, in an effort to attract more founders and foreign investors. OSI declined to comment.

Oxford’s high initial stakes can give it a tremendous influence on university start-ups, even after other investors dilute those stakes. Oxford and OSI, with a 40% stake in Vaccitech, have finally pressured biotechnology to sign more than 50% of the vaccine’s intellectual property share to allow the AstraZeneca agreement, the Journal reported earlier. Vaccitech was also kept out of negotiations with AstraZeneca.

AstraZeneca has publicly promised to deliver three billion doses without any profit this year. At the time of the partnership agreement, private communications show, OSI told Vaccitech that, like Oxford, it would not be eligible for any vaccine royalties while Covid-19 remained a pandemic for 12 months. then.

Vaccitech supporters who are pushing for access to the contract now want clarity on the full terms Oxford has reached in terms of paying royalties and any other benefits once AstraZeneca starts taking advantage of the doses, according to people familiar with the matter.

Write to Jenny Strasburg at [email protected]