Novavax makes $30M bid for adjuvant business

Vaccine adjuvants have stepped out of the shadows over the past few years. A suspected link to narcolepsy has hogged the headlines, but for vaccine makers, the immune boosting ingredients open up new virus targets. Adjuvants are fast becoming ubiquitous in vaccine development.

Novavax ($NVAX) showed the value it places on the ingredients this week when it lodged a $30 million all-stock bid for Swedish adjuvant business Isconova. The deal has the backing of the three largest shareholders, and Novavax expects to close the takeover by the end of next month. With the deal, Novavax gets ownership of a proprietary adjuvant technology it can use in vaccine candidates for pandemic flu, rabies, respiratory syncytial virus in the elderly, foot-and-mouth and other diseases. Novavax is trialling its pandemic flu vaccine both with and without adjuvants.

In Phase I, the adjuvanted vaccine gave high levels of seroprotection and seroconversion at low doses. Novavax declined to say which adjuvant it was using when questioned in March, but the Isconova range is set to become the frontrunner for its vaccines. The saponin-based adjuvant platform--called Matrix--uses selected fractions of bark from quillaja saponaria trees. Johnson & Johnson ($JNJ), Genocea and others are using the adjuvants in their pipeline vaccines, while Merck ($MRK) and Pfizer ($PFE) have included them in veterinary jabs. The adjuvants used in commercialized animal health vaccines earn Isconova around $2 million a year, but Novavax is mainly interested in what the technology can do for its own pipeline products.

In a call to explain the deal to investors, Novavax management talked up the value of retaining full economics of an adjuvanted vaccine and controlling all development and production. Novavax anticipates bringing adjuvant work in-house will enable it to improve and accelerate development of vaccines. Isconova employs 23 full-time equivalents and has production in place for Phase I and II trial materials. With several early-phase trials already underway, Isconova is planning for Phase III supply and manufacturing.

- here's the Novavax release
- check out the presentation (PDF)

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