BioWorld International Correspondent

Danish vaccine developer Bavarian Nordic A/S is acquiring its own manufacturing capability, which, from spring 2005, will enable it to produce up to 120 million vaccine doses annually.

The Copenhagen-based firm is purchasing a traditional pharmaceutical manufacturing facility in Kvistgaard, 30 kilometers north of the Danish capital, from Finnish drug maker Orion Pharma Oy, of Espoo. Its total investment in the project, including reconstruction, will be DKK250 million (US$41.1 million). The company will relocate its headquarters to the 26,000-square-meter site.

It will add 50 new production employees to the payroll. It also is planning to expand its R&D activities, which are based in Munich, Germany.

"We will add another 20 people, 25 people in R&D over the next six months," CEO Peter Wulff told BioWorld International. "It's mainly to accelerate development of our HIV and smallpox vaccines." The company will take another couple of months to decide whether it will establish filling and packing activities at Kvistgaard as well. That would add between 60 and 80 employees to the payroll.

Bavarian Nordic held DKK184.7 million in cash at the close of the third quarter and is forecasting gross profit - before interest charges and tax - of DKK250 million for the full year. The company might incur additional debt to help finance its expansion, in order to maintain liquidity, but it does not plan to raise additional investment, instead planning on profitability, Wulff said.

Since the start of the year, Bavarian Nordic had been planning either to build or buy a production capability, and it has considered several acquisition candidates.

"We were days from signing a contract to take another site abroad when we saw this place," Wulff said. The facility has buildings occupying 9,000 square meters, and there are plans to expand. It is, he said, a "perfect fit" for the company's requirements in terms of production flow and logistics.

The plant will focus on production of Bavarian Nordic's next-generation modified vaccinia ankara (MVA) vaccines. "We are not planning any contract manufacturing. We will need the facility to meet the demand for smallpox vaccines and, later on, HIV vaccines," Wulff said. The company recently secured its second award, worth up to $23 million, from the National Institute of Allergy and Infectious Diseases in Bethesda, Md., to continue its MVA smallpox vaccine program. It also disclosed positive data earlier this year from a Phase I/II trial of its HIV vaccine candidate, MVA-BN nef, which encodes the HIV nef protein. (See BioWorld International, Oct. 1, 2003.)

The company will maintain its presence in Berlin, which it gained through its acquisition earlier this year of GTB GenTherapeutika Berlin-Buch GmbH. The unit will continue in its current role of producing material for clinical trials. It also will continue its relationship with existing manufacturing partner Impstoffwerk Dessau-Tornau GmbH, of Rosslau, Germany.

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