Bavarian Nordic Receives $25 Million Milestone Payment From HHS for Fulfilling Contract Milestones
WASHINGTON DC, November 30 /PRNewswire-FirstCall/ -- Bavarian Nordic has received permission from the Department of Health and Human Services (HHS) to invoice a milestone payment of $25 million as allowed under the RFP-3 contract* to manufacture and deliver 20 million doses of the company's, IMVAMUNE(R) next-generation smallpox vaccine candidate. HHS granted permission because the company fulfilled a number of significant milestones in the contract. The income will be recognised as revenue in the company's financial statements for 2007.
Anders Hedegaard, President & CEO of Bavarian Nordic, said, "We are very satisfied that we have fulfilled another significant milestone as agreed with the Department of Health and Human Services. With the already received and future payments, we have created a solid financial base for our further development."
In October 2007, Bavarian Nordic received an advance payment of $50 million from HHS as allowed under the contract. In addition to this amount and the current milestone payment, the company expects to receive an additional milestone payment of $25 million in 2007.
About the smallpox vaccine contract
In June 2007, HHS awarded Bavarian Nordic a BioShield contract to manufacture and deliver IMVAMUNE(R), a next-generation smallpox vaccine candidate to the strategic national stockpile. The contract calls for the registration of IMVAMUNE(R) as a safe and effective smallpox vaccine in healthy people, but in the event of a smallpox outbreak the vaccine would be recommended to protect people who have weakened immune systems.(1)
The five-year contract is valued at more than $500 million, with an option that if exercised, extends the value to $1.6 billion and the performance period of the contract. The contract option would allow the government to procure up to an additional 60 million doses of IMVAMUNE(R) and support additional clinical studies for extending the license to include the HIV-infected, pediatric, and geriatric populations.
Bavarian Nordic's contract is the first next-generation, or completely new product procured by HHS under the BioShield program. It is also is the first contract where HHS has utilized all of its existing and newly-acquired payment authorities (Advance Payment, Milestone Advance Payment, and Performance Based Payment) as granted under the Project BioShield Act (2004), The Pandemic and All-Hazards Preparedness Act (2006), and the FAR subpart 32.10.
Notes/References
* This project has been funded in whole with Federal funds from the Office of the Assistant Secretary for Preparedness and Response, Biomedical Advanced Research and Development Authority, under Contract No. HHSO100200700034C.
(1) http://www.hhs.gov/news/press/2007pres/06/pr20070604a.html
About Bavarian Nordic
Bavarian Nordic, headquartered in Denmark, is a leading international biopharmaceutical company developing and producing innovative vaccines to prevent and treat infectious diseases and cancer.
In the U.S., Bavarian Nordic operates subsidiary companies, BN ImmunoTherapeutics, in Mountain View, California developing vaccines against cancers, and Bavarian Nordic Inc. in Washington, D.C. focused on business development, marketing, and government relations for the Bavarian Nordic Group. For more information on Bavarian Nordic visit: http://www.bavarian-nordic.com
"Safe Harbour" Statement under the Private Securities Litigation Reform Act of 1995": Except for the historical information contained herein, this release contains "forward-looking statements" within the meaning of the Private Securities Reform Act of 1995. No "forward-looking statement" can be guaranteed, and actual results may differ materially from those projected. Bavarian Nordic undertakes no obligation to publicly update any "forward-looking statement", whether as a result of new information, future events, or otherwise. Additional information regarding risks and uncertainties is set forth in the current Annual Report and in Bavarian Nordic's periodic reports, if any, which we incorporate by reference.
CONTACT: Elizabeth Dempsey Becker, Bavarian Nordic, Inc., +1(202)536-1576