(Reuters) - Pfizer (NYSE:PFE) has invested $25 million to buy a minority stake in Caribou Biosciences, making it the latest small biotechnology firm to attract the pharmaceutical giant's interest.
The news lifted shares of Caribou more than 61% in early trade.
Pfizer purchased nearly 4.7 million Caribou shares at $5.33 per share, Caribou said on Thursday, representing a premium of about 30% over Caribou's previous close price. This represents 7.64% of outstanding shares in Caribou, according to Reuters' calculation based on Refinitiv IBES data.
The investment in the cell therapy developer follows a string of deals made by Pfizer over the past few years with the drugmaker flush with cash from sales of its COVID-19 products.
In 2021, Pfizer had made an initial upfront investment of $500 million, including a $350 million share purchase, in migraine drug maker Biohaven Pharmaceutical, a company it acquired the following year.
It also made a $25 million equity investment in Akero Therapeutics (NASDAQ:AKRO) last year. Akero is developing a drug to treat a type of fatty liver disease called nonalcoholic steatohepatitis (NASH), which affects 5% of Americans but currently has no approved treatments.
California-based Caribou was founded jointly by Jennifer Doudna, a co-recipient of the 2020 Nobel Prize in Chemistry for developing a genome editing process using CRISPR - a method used by bacterial defense system for millions of years to protect themselves against viruses.
Caribou, which is developing cell therapies using CRISPR genome editing, said on Thursday it would use the proceeds from Pfizer's investment to advance its experimental CAR-T cell therapy, CB-011, that is currently being tested in an early-stage trial in patients with a type of blood cancer.