(Reuters) – British drugmaker GlaxoSmithKline will invest $250 million in Vir Biotechnology Inc and collaborate to develop potential treatments for COVID-19, the disease caused by the new coronavirus, the companies said on Monday.
Vir’s shares are off their premarket highs but still up 14% at 11:40am ET, while GlaxoSmithKline shares are up nearly 2%.
Drugmakers across the globe are rushing to develop a treatment or vaccine for the fast-spreading coronavirus that has killed over 68,400 people globally. There are currently no approved treatments for the disease.
The collaboration will bring Vir’s monoclonal antibody platform technology and GlaxoSmithKline’s expertise in functional genomics under one umbrella.
The companies said initial focus will be to accelerate development of Vir’s investigational treatments, VIR-7831 and VIR-7832, and plan to directly start with a mid-stage trial within the next three to five months.
Experts have said it could take 12 to 18 months to develop a coronavirus vaccine.
The equity investment from GlaxoSmithKline is priced at $37.73 per Vir share, a 30% premium to the stock’s Friday close.
Vir’s shares have more than doubled in the year up to Friday’s close.
GlaxoSmithKline has so far focused on providing adjuvants, efficacy boosters that play a vital role in many vaccines, as part of its efforts to find potential vaccines against the coronavirus.
This is California-based Vir’s second partnership with a major drugmaker for the development of a potential coronavirus treatment, having last month signed a letter of intent with Biogen Inc.
Gilead Sciences Inc is also testing its drug remdesivir as a potential coronavirus treatment.
Moderna Inc, which started testing its vaccine candidate in people last month, signed deals with the U.S. government in March to produce massive quantities of coronavirus vaccines.
Reporting by Trisha Roy in Bengaluru; Editing by Sriraj Kalluvila and Shounak Dasgupta.