By Geoffrey Smith
Investing.com -- Shares in Danish-German biotech Bavarian Nordic (CSE:BAVA) rose over 5% in morning trading in Europe Friday after the company announced a new vaccine research contract worth up to $83 million from the Pentagon.
Under the terms of the deal, the vaccine specialist will get a secured base of $55M to cover the costs of a phase 2 study and associated development and manufacturing costs for MVA-BN WEV, an experimental vaccine to prevent Western, Eastern, and Venezuelan equine encephalitis virus, which can cause a rare, but potentially deadly mosquito-borne illness in humans. There are currently no approved vaccines available for human use.
The company said that because of the ability of the MVA-BN vaccine platform to protect against multiple threats, this initiative has the capability to expand to other threat agents.
The deal, which runs through 2026, also includes options worth $28M to support preparations for a phase 3 trial. Based on current projections, the Phase 2 clinical study could start in 2024, the company said.
MVA-BN WEV was initially developed under an agreement with the Pentagon in 2018, which led to a trial that showed in June 2020 that the vaccine was well-tolerated and triggered clear immune responses across all dose groups.
Bavarian Nordic stock has had a rough couple of months as the alarm over the global outbreak of monkeypox has subsided. Its JYNNEOS vaccine is one of only two vaccines against monkeypox that have been approved in the U.S. While the company expects a rapid rise in sales as its production of JYNNEOS ramps up. The company still expects to make a loss of between DKK 100M and DKK 300M ($1 = DKK7.0068) before interest, taxes, depreciation and amortization this year.
By 05:00 ET (10:00 GMT), Bavarian Nordic stock was up 6.5% in Copenhagen at its highest in over a week.