Bavarian Nordic in peril if U.S. nixes smallpox vaccine order
Denmark's Bavarian Nordic may discover the dangers of putting all its eggs in one basket if the U.S. government does not order a smallpox vaccine by January.
The company's vaccine, called Imvamune, accounts for 95% of the company's revenue, according to Anders Hedegaard, CEO of the biotech company. In 2007, the United States awarded the company a $500 million health contract for 20 million doses, Bloomberg reports. The Department of Health and Human Services has yet to order the vaccine--a move that was expected in June. Not ordering the vaccine would force Bavarian Nordic to fire hundreds of workers and shut down a factory, Hedegaard says.
The vaccine is intended for individuals with a risk of severe adverse reactions to the regular smallpox vaccine. The federal stockpile is beginning to lose potency, the company says.
"If they do not get the extended order from the U.S. government, which they are expecting, then it'll be a matter of time before they run out of money," Thomas Bowers, an analyst for Danske Bank A/S, tells Bloomberg.
The company raked in $98 million last year, Bloomberg reports, and its product is funded through the federal Project BioShield program. The program, created in 2004, provides money for vaccines that would be used in the event of a terrorist attack. The funding dries up in 2013 if Congress doesn't make a move.
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