Canada announced on Friday that it has successfully reclaimed a substantial amount of the funding it provided to a Quebec-based Covid-19 vaccine maker. The biotech firm, owned by Japan’s Mitsubishi Chemical Group, was shut down earlier this year.
In an agreement with Mitsubishi, Canada will receive a repayment of 40 million Canadian dollars, equivalent to $29 million, out of the initial C$173 million financing it granted in October 2020 to construct a vaccine production facility. Additionally, Mitsubishi has agreed to transfer the research-and-development assets and intellectual property previously held by Medicago, the now-defunct biotech firm, to a newly established Canadian company in Quebec City called Aramis Biotechnologies.
The management of Aramis will be entrusted to former Medicago managers, ensuring a smooth transition of operations and expertise. Furthermore, a separate arrangement has been made to authenticate Aramis’s full ownership of these valuable assets.
Francois-Philippe Champagne, Canada’s Industry Minister, emphasized the significance of this agreement, stating that it presents a distinctive opportunity to leverage the original government investment in Medicago and retain crucial domestic assets within the Canadian ecosystem.
To support Canada’s response to the Covid-19 pandemic last year, the Canadian government had provided C$173 million to Medicago, which is owned by Mitsubishi. In addition, an agreement was signed to secure up to 76 million doses of Medicago’s Covid-19 vaccine.
Although Medicago’s vaccine was approved by Canadian regulators in 2022, it faced rejection by the World Health Organization due to its association with tobacco company Philip Morris International, which held a minority stake in Medicago. Consequently, Mitsubishi decided to close down Medicago in February, citing changes in the Covid-19 vaccine market.