Under the terms of the venture, Panacea Biotec has taken a 10% stake in Cambridge Biostability, for a total consideration of £1.935m.
In addition, Mr. Rajesh Jain, Joint Managing Director of Panacea Biotec, has been appointed to the Board of CBL as non-executive director.
Cambridge Biostability has also signed a long term licensing agreement with Panacea Biotec that could provide significant gross royalty income to CBL over the period.
Under the agreement, Panacea Biotec is to in-license CBL’s stable liquid technology to develop, produce and market a stable liquid version of pentavalent and other combination vaccines for the treatment of diptheria, tetanus, pertussis (whooping cough), hepatitis B and haemophilus influenza B, a major cause of bacterial meningitis and pneumonia in children.
The strategic investment in Cambridge Biostability gives Panacea Biotec more insight into CBL’s proprietary technology, its ongoing development and application in other vaccines and fields.
The size of the worldwide market for the above vaccines is estimated to be in the region of 300 million doses per annum. Key customers are UNICEF, PAHO, other supranational organizations and national governments with whom Panacea Biotec has built long-standing relations.
UNICEF alone purchases between USD 370 -400million of these vaccines annually and it is estimated that a pentavalent thermostable vaccine from Panacea Biotec has current market potential of over USD 135 million.
Panacea Biotec is expecting that it will commence clinical trials of the stable liquid pentavalent vaccine in 2008 with a global product launch expected in 2010.
Commenting on the news, David Stone, CBL’s Chief Executive said: “Panacea Biotec is one of the top biotechnology companies in India, with particular expertise in the field of vaccines. We are delighted to have signed this JV with such a leading force in vaccine development. Mr. Rajesh Jain brings enormous experience to the role and we are very pleased to be welcoming him to our Board as non-executive director. The licensing agreement is a landmark deal for CBL, and demonstrates the commercial potential of our stable liquid technology platform”
John Lambert, CBL’s Chairman added: “As well as being very exciting news for CBL, more importantly, it also brings the reality of having a stable liquid pentavalent vaccine out in the field one step closer – available for use in remote areas, at extreme temperatures and no requirement for the complex cold chain. This will greatly increase the number of children who will have access to these life saving vaccinations and save countless numbers of lives.”
Mr. Rajesh Jain, Joint Managing Director, Panacea Biotec said “Our joint venture and strategic investment with Cambridge Biostability strengthens our relationship with them and gives Panacea Biotec more insight into the development and application of thermostabilisation technology. CBL’s stable liquid technology removes the need for cold chain, which currently costs around USD 200 million a year. It also extends the shelf life of vaccines thereby saving around USD100 million in waste vaccines every year. The launch of a stable liquid pentavalent vaccine will be a significant milestone and growth driver for both partners.”