Bavarian Nordic In $187 Mln Deal With JNJ Affiliate For Ebola Vaccine; Stock Up

(RTTNews) - Shares of Bavarian Nordic A/S (BVNRY.PK) climbed around 15 percent in the morning trading in Copenhagen after the biotechnology firm Wednesday announced a global license and supply deal for its Ebola and Marburg vaccine candidate with an affiliate of Healthcare giant Johnson & Johnson (JNJ), aiming to help in the current outbreak in West Africa. Total potential agreement value including upfront payments, equity investment, milestones and supply contract, is in excess of $187 million.

Separately, Johnson & Johnson announced that it has made a commitment of up to $200 million to accelerate and significantly expand the production of an Ebola vaccine program in development at its Janssen Pharmaceutical Companies. The company is closely collaborating with various health authorities on the clinical testing, development, production and distribution of the vaccine regimen.

In its statement, Bavarian Nordic said it has signed the deal for its MVA-BN Filovirus (Ebola and Marburg) vaccine candidate with Crucell Holland B.V., an affiliate of Johnson & Johnson's Janssen.

Under the deal terms, Bavarian Nordic will grant Janssen an exclusive license for its multivalent MVA-BN Filovirus vaccine, designed to protect against Ebola Zaire, Ebola Sudan and Marburg virus.

Bavarian Nordic will receive an upfront payment of $25 million and is entitled to up to $20 million in development and regulatory milestones, in addition to royalties for commercial sales outside Africa. Janssen will be fully responsible for all costs associated with the development and commercialization of the vaccine.

In addition, Bavarian Nordic will scale up its production and is targeting to manufacture more than 1 million doses of the vaccine valued at $99.3 million, of which Janssen will make an upfront payment of $70.8 million. The remaining $28.5 million will be received pro rata with deliveries in 2015.

Additionally, through a private placement, Johnson & Johnson Development Corp. will invest approximately $43 million to subscribe for new shares of Bavarian Nordic.

As a consequence of the agreement, Bavarian Nordic raised its expectations for the year-end cash preparedness from approximately 600 million Danish kroner to 1 billion kroner, including a reduction in debt and credit facilities of approximately 150 million kroner. The expectations for full year revenues and result are maintained as the vast majority of the agreement will be revenue recognized in 2015.

In Denmark, Bavarian Nordic shares were gaining 15.67 percent, and trading at 173.50 kroner.

In pre-market activity, JNJ shares were gaining 0.20 percent, and trading at $100.56.