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Money News

AstraZeneca bolsters COVID-19 vaccine supply with new deal

(Reuters) - AstraZeneca has expanded its agreement with cell therapy firm Oxford Biomedica to mass-produce its COVID-19 potential vaccine, as it looks to scale-up supply ahead of a possible U.S. fast-track approval.

While the British drugmaker works on the widely watched coronavirus vaccine hopeful, AZD1222, its main portfolio of treatments for cancer, diabetes and heart diseases scored a win after its drug, Imfinzi, was approved for use in Europe to treat an aggressive form of lung cancer.

The company’s shares gained as much as 1.5% to trade at 84.6 pounds by 0807 GMT, outperforming the benchmark FTSE-100 index, after Oxford Biomedica announced the expanded agreement and on news of the EU approval for Imfinzi.

Cambridge-based AstraZeneca’s vaccine is among the leading candidates in the global race for a successful vaccine and it has entered late-stage trials in the United States, the company said on Monday, as it targets 3 billion doses of the vaccine, globally.

Oxford Biomedica said in a statement that AstraZeneca would give it 15 million pounds ($20 million) upfront to reserve manufacturing capacity at Oxford Biomedica’s plant and that it could get an additional 35 million pounds under a new 18-month deal.

The company was spun off in 1995 from the University of Oxford, which developed the vaccine before licensing it to AstraZeneca in April.

It was among AstraZeneca’s initial partners when they teamed up to produce the vaccine and focus on UK and European supply. Tuesday’s deal could be expanded further by another 18 months into 2022 and 2023, Oxford Biomedica said, sending its share price up 2.1% to 862 pence.

“Our previously announced partnership with the UK’s Vaccine Manufacturing Innovation Centre (VMIC) has supported our ability to make additional facilities available for this supply agreement,” said Oxford Biomedica’s Chief Executive John Dawson.

The company, however, did not specify how many doses of AstraZeneca’s vaccine it expects to produce under the expanded deal, which is for “large-scale commercial manufacture,” according to its statement.

(This story corrects paragraph 3 to say EU (not U.S.) approval for Imfinzi)

Reporting by Pushkala Aripaka and Aakash Jagadeesh Babu in Bengaluru; editing by Patrick Graham and Susan Fenton

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