A major contract to produce a smallpox vaccine for the U.S. has pulled a British vaccinemaker from the vast ranks of biotech companies begging investment bankers for financial help these days.
“The contract has transformed the company,” Acambis PLC Chief Executive John Brown told Wall Street investors gathered at last week’s annual Biotechnology Industry Organization CEO and investor conference.
Acambis PLC and its manufacturing partner, Baxter International Inc. of Deerfield, last fall won a $428 million contract to produce 155 million doses of smallpox vaccine, which will be stockpiled with the country’s existing supply as a precaution against bioterrorist attack. Production of the vaccines is under way.
While the contract went a long way to increase Baxter’s profile as a vaccinemaker, it didn’t mean as much to Baxter’s bottom line as it has for Acambis’. Analysts are now predicting Acambis will make money for the first time.
Profits are almost always elusive for biotech companies that live on the hope even one drug will make it successfully through the lab into human clinical trials and then win approval for marketing.
Fewer than 20 of the more than 1,300 biotech companies are producing revenue, let alone profits, so they always face skeptical bankers.
But Acambis isn’t looking for bankers these days.
“We now have underpinning financial strength,” Brown said. “We have no plans to seek any fundraising. We don’t have those cycles to worry about.”
Acambis is projecting to have $150 million in the bank by the end of this year, largely because of the contract.
That money will help fund ongoing operations and develop its other products, including yellow fever and Japanese encephalitis vaccines, which are both in human clinical trials, company executives said.
Insurance called tops: Health care is the No. 1 benefit for most workers, according to a recent study of large, self-insured employers by benefits consulting firm Hewitt Associates of Lincolnshire.
Hewitt said 55 percent of workers in employee-sponsored health plans thought health coverage was their most important benefit, and 82 percent ranked it first or second.
Compensation was the No. 2-ranked benefit for workers.
What’s more, two-thirds of the survey’s respondents said health insurance coverage was the primary factor in “staying or choosing employment.”
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“It’s not surprising that health care is becoming more important to employees as both the economy and labor market are declining,” said Jack Bruner, Hewitt’s national practice leader.