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Modern said on Wednesday it had reached an agreement with Chinese officials to research, develop and manufacture messenger RNA drugs in the country, despite rising tensions between the United States and China.
The Massachusetts-based biotech company has signed a memorandum of understanding and related ground collaboration agreement to develop drugs that “will be exclusively for the Chinese people” and will “not be exported,” a spokesperson told CNBC. by Moderna.
Chinese news outlet Yicai first reported on Tuesday that Moderna is set to make its first investment in China that could be worth around $1 billion, citing unnamed sources. The outlet also reported that Moderna CEO Stephane Bancel was visiting Shanghai.
Moderna’s spokesperson did not confirm the report or comment on the size of the deal.
“These agreements are focused on strengthening health security by targeting unmet needs and contributing to the ecosystem of medical solutions available to patients in China,” the spokesperson said.
Moderna is trying to capitalize on the success of its Covid vaccine, which uses a platform called mRNA to teach human cells how to mount an immune response against a virus.
Moderna has several contracts to export or locally manufacture Covid jabs for countries including Japan, Canada, Australia and Kenya. The agreement unveiled on Wednesday is the company’s first deal with China.
It is also the first deal to involve mRNA drug development as a whole, not just Covid injections.
Moderna said in May it wanted to sell its Covid mRNA vaccine to China after registering a legal entity in the world’s second-largest economy.
But the company and other US-based companies have so far been locked out of the Chinese market.
Beijing has repeatedly insisted on using Chinese-made Covid vaccines for its population, even though their vaccines are considered less effective than Moderna’s and New York’s vaccines. Pfizer.
The country has also struggled to develop mRNA technology at home during the pandemic. China only approved its first mRNA shot earlier this year.
Separately on Wednesday, China’s Commerce Ministry said it had held a meeting with some of the world’s leading drugmakers to discuss their business activities in the country.
Including Pfizer, AstraZeneca, Novo Nordisk, Merck, Sanofi And GE HealthCare Technologies. It is unclear if Moderna was included in the roundtable.
Moderna’s deal comes as tensions between the United States and China rise over issues ranging from national security to a heavy reliance on Chinese supply chains. The Biden administration has taken aggressive steps to diversify away from China into investment and trade.