Acambis says future cash position better with $30 million ACAM2000 order, litigation award

By Jennifer Lanning Drey

Eugene, Ore., Sept. 13 - Acambis plc said its cash outlook has been considerably improved with the announcement that it will receive $30 million from the U.S. government in early 2007 for a 10 million-dose order of the ACAM2000 smallpox vaccine.

The U.S. Centers for Disease Control and Prevention has agreed to purchase the 10 million doses as part of an existing ACAM2000 supply contract under which Acambis has already delivered 182.5 million doses of ACAM2000 for the strategic national stockpile.

"With the new ACAM2000 order cash coming in in the first quarter of 2007, we expect to be at, or above, our Q2 2006 number at the end of Q1 2007," said David Lawrence, Acambis' chief financial officer, during a company conference call held Wednesday.

The order has also brought Acambis confidence that the U.S. government will award the company the long-term warm-base manufacturing contract for ACAM2000 that the two sides are currently negotiating, said Gordon Cameron, Acambis' chief executive officer, during Wednesday's call.

The company now expects the contract to following licensing of ACAM2000, which has a Food and Drug Administration First Action Due Date of Feb. 14, Cameron said.

"I think in terms of our level of confidence as to the actual contract coming through in the early part of next year, I think it's fair to say that they wouldn't spend $30 million for 10 million doses of vaccine if they weren't fully intending for us and for them to engage in long-term warm-based manufacturing," Cameron said.

The aim of the warm-base manufacturing program is to provide access to ACAM2000 production capability in the United States, and Acambis plans to transfer production of the drug to facilities in Canton, Mass., and Rockville, Md. Previously production was partly handled by Baxter at a facility in Austria.

Increased revenue guidance

In addition to the ACAM2000 contract, Acambis' future cash balance was increased this week with Wednesday's announcement that Novartis will pay the company $19 million in cash to settle a dispute related to the Arilvax yellow fever vaccine, he said.

"I think it's fair to say that the financial outlook of the company is considerably better than it was a couple of days ago," said Cameron.

As a result, the company increased its predictable revenue guidance to approximately £30 million, according to a company news release.

Other sources of potential future income include a possible contract with the U.S. government for Acambis to supply MVA3000 smallpox vaccine and additional partnering opportunities, Lawrence said.

Acambis had cash and short-term investments of £40.4 million at June 30, compared to £68.0 million at Dec. 31, 2005, according to a company news release.

More vaccines in trials

On the development side, Acambis has completed a phase 1 clinical trial of its C. difficile vaccine in healthy elderly patients 65 years and older, which is the main target of the vaccine, Cameron said Wednesday.

The company said the trial produced encouraging data, with 100% seroconversion to C. difficile toxin A and 75% to toxin B with the highest dose of the vaccine.

Acambis plans to begin future clinical trials in 2007.

"From the market point of view, I think it's panning out exactly as we expected," said Cameron, adding that the number of cases of the disease has been increasing.

Acambis also reported Tuesday that results from the first component of its phase 2 clinical trial of ChimerVax TM-West Nile, its investigation vaccine against West Nile virus, were "encouraging."

The company will move forward with the second part of the trial in 2007 and then seek a partner for further development.

"The possible size of the trial as well as the commercialization infrastructure required is probably beyond our means, and therefore we will be seeking to get a partner to support these programs," Cameron said.

Acambis also plans to submit an Investigational New Drug application for ACAM-FLU-A, its pandemic flu vaccine, by the end of the year with clinical trials expected to start in early 2007, he said.

Acambis, based in Cambridge, England, develops vaccines to prevent and treat infectious diseases.

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