U.S. government orders additional $133M of Bavarian Nordic's smallpox vaccine

In the past 5 years, Bavarian Nordic has delivered 28 million smallpox vaccine doses to the U.S. government's stockpile to protect against renegade stocks or re-engineered viruses. That partnership is showing no signs of slowing as the U.S. government placed a large new order for the vaccine on Tuesday while Bavarian Nordic continues work to improve its formulation to offer more stockpiling flexibility.

The company announced that the U.S. Department of Health and Human Services' Biomedical Advanced Research and Development Authority (BARDA) ordered an additional $133 million bulk supply of its smallpox vaccine Imvamune for stockpiling, an extension of the pair's current deal. The vaccine--which protects against the eradicated smallpox virus--will be produced and the revenue recognized in 2016 and into 2017.

BARDA's order follows the Danish company reporting in May that its freeze-dried formulation--with a longer shelf life than the liquid-frozen form--induced an equal immune response in a Phase II study. In its statement, Bavarian Nordic said the new order could be converted into the freeze-dried formulation after the manufacturing process is transferred to a commercial line and approved by U.S. authorities, the only outstanding activities required for stockpiling the new form.

Bavarian Nordic CEO Paul Chaplin

"This order was made possible by previous BARDA funding, which allowed us to identify a new process to extend the shelf-life of the bulk vaccine," Bavarian Nordic CEO Paul Chaplin said in a statement.

Last year, Imvamune accounted for 80% of the company's revenue at more than $150 million; the company said the new order serves as a precursor for future contracts for the freeze-dried product. And though Bavarian Nordic is advancing its lead product through the steps mentioned, Chaplin said in late May that his company isn't interested in hearing buyout offers despite the M&A wave and premiums sweeping across biopharma.

Smallpox isn't the only realm that Bavarian Nordic is getting involved in, though, as its Phase III prostate cancer vaccine Prostvax attracted a deal worth nearly $1 billion from Bristol-Myers Squibb ($BMY) in March. Pointing to improved survival data from the pair in research from the National Cancer Institute, the pharma inked a partnership worth $60 million up front and up to $915 million in milestones.

- here's the release

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