Sanofi Pasteur and Translate Bio have agreed to expand their existing 2018 collaboration and license agreement to develop mRNA vaccines for infectious diseases.

Under the expanded deal, Translate Bio will receive a total upfront payment of $425 million, consisting of a $300 million cash payment and a private placement common stock investment of $125 million at $25.59 per share, representing a 50% premium to the 20-day moving average share price prior to signing.

Translate Bio will also be eligible for potential future milestones and other payments up to $1.9 billion, including $450 million of milestones under the 2018 agreement.

Of these, around $360 million are anticipated over the next several years, inclusive of COVID-19 vaccine development milestones, and Translate Bio is also eligible to receive tiered royalty payments on worldwide sales of any vaccines making it to market.

Sanofi will pay for all costs during the collaboration term, in return for exclusive worldwide rights for infectious disease vaccines.

“As all eyes are on prevention of infectious disease through vaccines, this is a pointed moment in time where we are called upon to seek innovative ways to protect public health,” said Thomas Triomphe, Sanofi Pasteur executive vice president.

“We are excited by the novel technology and expertise Translate Bio brings, and we believe that adding this mRNA platform to our vaccines development capabilities will help us advance prevention against current and future infectious diseases.”