Ablynx signs Sanofi deal potentially worth up to $2.8 billion

FILE PHOTO - A logo is seen in front of the entrance at the headquarters French drugmaker Sanofi in Paris October 30, 2014. REUTERS/Christian Hartmann/File Photo

(Reuters) - French drugmaker Sanofi boosted its early-stage pipeline in immunology on Thursday by signing a deal with Ablynx that could earn the Belgian biotech firm as much as 2.4 billion euros ($2.8 billion).

Initial payments are a lot less, with Ablynx receiving an upfront payment of 23 million euros and 8 million in research funding, but big milestones will kick in if any of the experimental projects achieve commercial success.

The deal gives Sanofi access to a total of eight of Ablynx’s so-called nanobody medicines, which are derived from camel and llama antibodies. The focus is on developing products to treat immune-mediated inflammatory diseases, the companies said.

Shares in Ablynx rose more than 6 percent in early trading on news of the tie-up.

For Sanofi, the deal expands the company’s drug discovery efforts in immunology at a time when it is launching a promising new treatment for severe eczema.

Reporting by Ben Hirschler; Editing by Keith Weir