PARIS, France – Pharmaceutical company Sanofi has made a significant acquisition in the rare disease space, purchasing Inhibrx’s lead rare disease asset, INBRX-101, for up to $2.2 billion. This move comes as part of Sanofi’s broader strategy to expand its pipeline, particularly in the area of rare diseases.

INBRX-101 is a novel therapeutic designed for Alpha-1 Antitrypsin Deficiency (AATD), a genetic disease that affects the lungs and liver. The drug’s unique design as an Alpha-1 Antitrypsin (AAT)-Fc fusion protein aims to normalize serum AAT levels, with the goal of less frequent dosing compared to existing treatments.

Sanofi’s acquisition of INBRX-101 is part of its continued strategic expansion into rare diseases. Previous efforts in this area include a proposed $150 million deal for Pompe disease, as well as the expansion of their Rare Blood Disorders franchise through acquisitions and in-house programs.

Financially, Sanofi appears well-positioned to fund the $2.2 billion acquisition, with substantial cash reserves, high assets, and robust equity. However, the company’s debt situation is a critical aspect to consider, with total debt at $22.23 billion and a net debt of $13.78 billion.

In terms of peer comparison, Sanofi presents a unique juxtaposition in the pharmaceutical landscape with attractive valuation, modest growth metrics, and strong profitability. The company’s stock is currently considered a “hold,” according to some analysts, as revamping drug pipelines remains a challenging task.

Overall, this acquisition of INBRX-101 represents a significant step for Sanofi in bolstering its rare disease portfolio. The company’s strategic acquisitions such as this one are aimed at enhancing their growth opportunities and could be an interesting addition to a diversified portfolio, though investors are advised to monitor the company’s quarterly financial performance and pipeline updates.