BioWorld International Correspondent

LONDON - The gloves are off in the long-simmering fight between Bavarian Nordic A/S and Acambis plc over smallpox vaccines, with the Danish company filing two U.S. legal suits alleging patent infringement and theft of trade secrets.

The move came two days after the U.S. government issued its requirements for a contract to supply 20 million doses of modified vaccinia ankara (MVA) smallpox vaccine, with an option to buy 60 million more doses, for the national stockpile. Overall that contract is expected to be worth up to $1 billion.

More than two years after first airing the issue, Bavarian Nordic filed a claim of patent infringement against Acambis' MVA3000 vaccine at the U.S. International Trade Commission in Washington and a second suit alleging misappropriation of trade secrets in the U.S. Federal District Court of Delaware.

Bavarian Nordic has built a strong intellectual property position around its MVA product, MVA-BN, which forms the core of its smallpox vaccine Imvamune, and is being developed also as an antigen vector for a range of vaccines. The question is if, as claimed, Acambis' MVA3000 is based on the proprietary MVA strain and dosing information Bavarian Nordic uses in Imvamune.

The MVA vaccine is intended to protect an estimated 20 percent of the U.S. population who have weak immune systems or skin disorders and cannot tolerate full strength smallpox vaccine. MVA was developed originally in the 1950s as a highly attenuated strain that cannot replicate in human cells, making it safe for immunocompromised subjects.

The legal moves were announced by Copenhagen-based Bavarian Nordic after the markets closed Friday in Europe. Monday morning Gordon Cameron, CEO of Acambis, said there is no case to answer.

"We have always maintained, having consulted throughout with external patent counsel, that we have the freedom to research, develop, manufacture and sell our MVA vaccines candidate," he said. "That position still stands."

Lyndsay Wright, vice president of communications at Cambridge-based Acambis, told BioWorld International the company had not received details of the suits and could not comment on any specific claims. "We will have to wait and see the details and will vigorously defend our position," he said.

In the patent-infringement claim, Bavarian Nordic is seeking royalties from Acambis, while in the trade secrets claim it is asking for damages and an injunction. Peter Wulff, president and CEO, said the company has made a significant investment to develop MVA-BN and holds two U.S. patents covering its unique properties. "These legal actions are being taken to protect our assets," he said.

Acambis and Bavarian Nordic are the only serious contenders for the contract to supply the U.S. stockpile. The news had little impact on the share price of either, with Bavarian Nordic falling 1.7 percent to DKK450 and Acambis 2.7 percent to £2.44 (US$4.40) in early trading Monday.

The companies have won significant U.S. contracts for MVA vaccines already, with Acambis awarded business worth a total of $86.1 million, with an option for a further $55.5 million still outstanding, while Bavarian Nordic has won contracts worth $120 million. Both MVA3000 and Imvamune are in Phase II development and both companies have manufacturing facilities in place.

The deadline for submitting proposals for the stockpile contract is Sept. 29, with the contract awarded in February 2006. Wright said Acambis will go ahead with bidding and does not expect the legal suits to interfere with the contract process.

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