Vaccine developer Novavax announced a new deal with Spain's health ministry and drugmaker ROVI Pharmaceuticals Tuesday afternoon, sending its stock soaring 35 percent in afternoon trading. Spanish officials have committed €60 million to develop vaccines and establish the country's first vaccine plant to be built in Granada. Under agreements currently being negotiated, Rockville, MD-based Novavax will license its proprietary virus-like-particle vaccine technology to Spain's ROVI, which will use the technology to produce pandemic and seasonal flu vaccines.
The Spanish government will fund the development and provide the capital needed to get the vaccines through the regulatory process. The parties hope to have the manufacturing plant completed and the vaccines approved in 2012. ROVI will have exclusive rights to market the vaccines in Spain and Portugal, but Novavax will retain the rights to all other markets. Novavax President and CEO Rahul Singhvi seemed excited about the arrangement as he explained that the deal provides a funding pathway to get the company's products approved worldwide, while only giving up exclusive rights in two markets. "We were aggressive [in developing our vaccines] to begin with but [this] gives us a pathway to finance without doing a partnership deal which could be a lot less attractive," he tells FierceBiotech.
For its part, Novavax will receive much needed capital. In the short term, the company will get a $3 million equity investment from ROVI, a 10 percent premium over Monday's closing price. The developer is also in line for an undetermined future royalty and milestone payments, which could reach the tens of millions, a spokesperson told the Associated Press. Singhvi says there was mutual interest between the company and Spain officials, which--like a number of other countries--has shown interest in the company's VLP technology and the prospect of having an efficient and low cost vaccine manufacturing production within the country. "The idea that you can have that capacity in your borders is very attractive," said Singhvi.
The CEO says the company will set up operations in Spain through ROVI and he expects to hire new staff across the board.
- here's the Novavax release