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Smallpox vaccine puts Acambis into profit

Published on 31/10/03 at 12:23pm

Vaccine company Acambis has joined rivals PowderJect and Celltech in the elite group of profitable UK biotech companies.

The company recorded its first ever pre-tax profit of £9.6 million in 2002, compared with losses of £12.6 million the year before, as it continued to reap the success of its smallpox vaccine contracts with the US Government.

Acambis has been awarded two multi million-dollar contracts to supply the US Centers for Disease Control and Prevention (CDC) with 209 million doses of smallpox vaccine to protect against the threat of a bioterrorist attack.

Revenues for the year rose more than 800% to £79.7 million on the back of the CDC contracts, which analysts estimate will have a gross profit margin of around 40%.

The company sees its smallpox vaccine franchise as its prime growth driver, anticipating revenues of between $240 and $280 million this year from the CDC, with lower revenues expected until 2005.

US and European regulatory submission is expected in 2004 and, if successful, could see the sale the vaccine to individuals. Acambis said there was already strong demand from US citizens, which represented a strong market opportunity.

Another main growth strategy will see the company focus on its travel vaccines portfolio. Products include yellow fever vaccine Arilvax, due for launch in 2004, and ChimeriVax-JE, for Japanese encephalitis, due in 2006.

"The company's remarkable success in delivering smallpox vaccine during the last year and our focused business strategy for sustained profitability provide a strong foundation on which to establish Acambis as a major international force in the vaccines industry," said Chief Executive Dr John Brown.

The first CDC contract, awarded in September 2000 and worth around $343 million, required Acambis to supply 54 millions doses of its ACAM1000 vaccine, currently in phase II trials.

The second, $428 million contract, awarded in November 2001, is for 155 millions doses of ACAM2000. The company is confident of delivering the vaccine in the first half of the year, with recent phase I trials showed it to produce a positive immunological response in 99% of patients. Phase II trials are already underway with phase III testing expected later in the year.

The company has signed a further eight smallpox vaccine contracts with governments, including five in Europe, though these will be worth only $20 million this year.

A new $9.2 million contract has also been signed with the US National Institutes of Health to develop a modified vaccinia ankara (MVA) vaccine - a weakened form of its smallpox vaccine for people with a lowered immune system. The programme will be undertaken with the company's strategic partner, Baxter Healthcare.

Acambis is competing with Danish biotech Bavarian Nordic to secure a US contract to supply 30 million doses of MVA this year, worth between an estimated $150 and $300 million.

In addition, Acambis is partnering with Cangene Corporation to market its vaccinia immune globulin (VIG) product, for patients who develop severe reactions to smallpox vaccine, outside of North America and Israel.

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