Dive Brief:

• Blackstone Life Sciences will invest as much as $750 million on influenza vaccine research and development by Moderna, announcing Wednesday a private funding deal that gives the private equity firm rights to future payments and royalties.

• Moderna has advanced an mRNA-based flu shot into late-stage testing and is also studying a combination flu and COVID-19 vaccine — part of a broad R&D strategy to follow the success of its standalone COVID shot. Later this year, the company intends to submit the flu shot for regulatory approval.

• The funding agreement comes one day after Moderna revealed results for a “next-gen” COVID vaccine that it said showed higher immune responses than the biotechnology firm’s current product. This next-gen vaccine is being used in the combination flu and COVID vaccine that’s now in Phase 3 testing.

Dive Insight:

The new trial results and funding were announced alongside a “vaccine day” that Moderna has held for the past five years. The biotech, which was criticized in its early years for investing in vaccine R&D, has now built a large business around infectious disease research.

Sales of the company’s widely used COVID-19 shot have fallen sharply, however, pushing the company to invest in its vaccines for flu and respiratory syncytial virus.

“Our goal is to launch multiple vaccine products in the next few years and deliver the greatest possible impact to people through mRNA medicines,” said Stéphane Bancel, CEO of Moderna. “Achieving this ambition requires substantial investment in late-stage studies and we are excited to welcome Blackstone and their innovative financing model.”

The company’s flu candidate, dubbed mRNA-1010, has delivered mixed results in Phase 3 testing, outperforming existing shots against “A”, but not “B”, strains in one of several trials Moderna has run. Moderna updated the shot’s formula to better address both strains.

Overall, Moderna has five vaccines in Phase 3 testing, and another three that it expects to soon advance into late-stage trials for Epstein-Barr virus, Varicella-Zoster virus and norovirus.

Moderna predicts the market for flu vaccines will be $7 billion in 2024, while it sees the market for RSV shots growing to $10 billion annually. GSK and Pfizer currently sell RSV vaccines in the U.S.

Per the new agreement, Blackstone Life Sciences will receive commercial milestone payments and low-single digit royalties from Moderna on flu vaccine products. The new funding does not change Moderna’s guidance for spending $4.5 billion on R&D this year, the company said.

The investment by Blackstone is one of many the firm has made in life sciences, including a similar deal it struck with Sanofi to provide R&D funding for the French company’s multiple myeloma medicine. It has also invested in Autolus Therapeutics, Ferring Pharmaceuticals, Alnylam Pharmaceuticals and Anthos Therapeutics.

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