Chiron Inc. has reduced its estimated production range for Fluvirin, citing delays in start-up procedures, as the company gears up for full vaccine production for the 2005-2006 flu season.

After the UK regulatory authority lifted its manufacturing suspension in March at the company's Liverpool, UK, facility, Chiron announced in its first-quarter earnings that it expected to produce between 25 million and 30 million doses of Fluvirin. However, the company now estimates producing between 18 million and 26 million doses.

The reduction also has affected Chiron's 2005 guidance. Instead of an expected annual income of $1.40 to $1.50 per share, the firm expects income to fall between $1.20 and $1.45 per share.

Chiron's stock (NASDAQ:CHIR) fell 6.5 percent Wednesday, or $2.48, to close at $35.47.

The company said the delay in reaching full production is related, in part, to last year's events, as well as the typical manufacturing issues involved in influenza vaccine production.

"The position we're in right now is that we are producing [Fluvirin] as we normally do for the upcoming flu season, and, at the same time, we're continuing with our remediation efforts," said Alison Marquiss, spokeswoman for the Emeryville, Calif.-based company.

"We're basically working on two fronts, and it has taken longer than we anticipated," she told BioWorld Today.

Chiron failed to produce an expected 46 million to 48 million doses of Fluvirin for the U.S. influenza market last year - about half the nation's flu vaccine. The Medicines and Healthcare products Regulatory Agency (MHRA) in October temporarily suspended the company's license to manufacture Fluvirin at the Liverpool facility, its only facility authorized to supply flu vaccine to the U.S. (See BioWorld Today, Oct. 6, 2004.)

This year, Chiron would be responsible for a smaller percentage - around 25 percent - of the total U.S. vaccine supply. Sanofi-Aventis Group, of Paris, is expected to supply the majority of the flu vaccine, though London-based GlaxoSmithKline plc has filed for U.S. approval of its Fluarix. Gaithersburg, Md.-based MedImmune Inc. also is looking to treat the market with its intranasally administered FluMist.

In the meantime, Chiron has continued the remediation of the Liverpool facility, an effort that Marquiss described as "comprehensive and far-reaching," to focus on all areas of production - from the process to the people to the equipment. In its first-quarter earnings, the company reported that it had incurred costs of $16 million associated with the remediation, as well as $10 million in legal expenses, and anticipates additional costs throughout 2005.

An FDA inspection is expected next month to address issues discussed in a warning letter sent by the agency in December. If the FDA is not satisfied after the inspection, or the company encounters other manufacturing hold-ups, Chiron might end up having to reduce its Fluvirin dose range further. On the other hand, if the remediation process progresses smoothly, the firm actually could meet its original production range. All estimates are based on the assumption that Chiron will sell Fluvirin through the end of November.

Marquiss said Chiron is looking forward to the FDA's inspection as another step that will "get the product into the arms of the consumers in the fall."

While its flu vaccine captured most of the headlines for the past year, Chiron has continued advancing products in its biopharmaceutical pipeline. Earlier this week, the Global Alliance for TB Drug Development initiated a Phase I trial of Chiron's tuberculosis drug candidate, PA-824, and, working with the Multiple Myeloma Research Consortium, the company recently announced the start of clinical trials of CHIR-258, an orally available kinase inhibitor.

Chiron expects to hear by July 14 whether the FDA will grant marketing approval of Pulminiq (cyclosporine) for patients who have undergone lung transplants.

The company reported net income of $7 million for the first quarter. As of March 31, Chiron had cash and short-term investments totaling $629 million.