WASHINGTON DC, November 30 Bavarian Nordic hasreceived permission from the Department of Health and Human Services (HHS) toinvoice a milestone payment of $25 million as allowed under the RFP-3contract* to manufacture and deliver 20 million doses of the company's,IMVAMUNE(R) next-generation smallpox vaccine candidate. HHS grantedpermission because the company fulfilled a number of significant milestonesin the contract. The income will be recognised as revenue in the company'sfinancial statements for 2007.
Anders Hedegaard, President & CEO of Bavarian Nordic, said, "We are verysatisfied that we have fulfilled another significant milestone as agreed withthe Department of Health and Human Services. With the already received andfuture payments, we have created a solid financial base for our furtherdevelopment."
In October 2007, Bavarian Nordic received an advance payment of $50million from HHS as allowed under the contract. In addition to this amountand the current milestone payment, the company expects to receive anadditional milestone payment of $25 million in 2007.
About the smallpox vaccine contract
In June 2007, HHS awarded Bavarian Nordic a BioShield contract tomanufacture and deliver IMVAMUNE(R), a next-generation smallpox vaccinecandidate to the strategic national stockpile. The contract calls for theregistration of IMVAMUNE(R) as a safe and effective smallpox vaccine inhealthy people, but in the event of a smallpox outbreak the vaccine would berecommended to protect people who have weakened immune systems.(1)
The five-year contract is valued at more than $500 million, with anoption that if exercised, extends the value to $1.6 billion and theperformance period of the contract. The contract option would allow thegovernment to procure up to an additional 60 million doses of IMVAMUNE(R) andsupport additional clinical studies for extending the license to include theHIV-infected, pediatric, and geriatric populations.
Bavarian Nordic's contract is the first next-generation, or completelynew product procured by HHS under the BioShield program. It is also is thefirst contract where HHS has utilized all of its existing and newly-acquiredpayment authorities (Advance Payment, Milestone Advance Payment, andPerformance Based Payment) as granted under the Project BioShield Act (2004),The Pandemic and All-Hazards Preparedness Act (2006), and the FAR subpart32.10.
* This project has been funded in whole with Federal funds from theOffice of the Assistant Secretary for Preparedness and Response, BiomedicalAdvanced Research and Development Authority, under Contract No.HHSO100200700034C.
About Bavarian Nordic
Bavarian Nordic, headquartered in Denmark, is a leading internationalbiopharmaceutical company developing and producing innovative vaccines toprevent and treat infectious diseases and cancer.
In the U.S., Bavarian Nordic operates subsidiary companies, BNImmunoTherapeutics, in Mountain View, California developing vaccines againstcancers, and Bavarian Nordic Inc. in Washington, D.C. focused on businessdevelopment, marketing, and government relations for the Bavarian NordicGroup. For more information on Bavarian Nordic visit:http://www.bavarian-nordic.com
"Safe Harbour" Statement under the Private Securities Litigation ReformAct of 1995": Except for the historical information contained herein, thisrelease contains "forward-looking statements" within the meaning of thePrivate Securities Reform Act of 1995. No "forward-looking statement" can beguaranteed, 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, futureevents, or otherwise. Additional inform