WASHINGTON D.C., November 6 /PRNewswire/ -- In a business update, Danish-based biopharmaceutical company Bavarian Nordic, reported a number of developments in its vaccine project pipeline.

IMVAMUNE(R) next-generation smallpox vaccine

Clinical development of IMVAMUNE(R) as a safe smallpox vaccine is proceeding as planned. Phase III studies with IMVAMUNE(R) in healthy subjects are expected to be initiated in 2008.

Bavarian Nordic received an advance payment of $50 million from the Department of Health and Human Services (HHS) as allowed under the RFP-3 contract. The contract calls for the manufacture and delivery of 20 million doses of the company's, IMVAMUNE(R) investigational smallpox vaccine to the strategic national stockpile. Payment was received because the company fulfilled a number of significant milestones in the contract. Before year-end Bavarian Nordic expects to invoice two additional milestone payments of $25 million each, bringing the total payment to be received in 2007 on the RFP-3 contract to $100 million.

The National Institutes of Allergy and Infectious Diseases (NIAID) extended an existing contract (RFP-2 awarded in 2004) to initiate a larger Phase II study with IMVAMUNE(R) in people diagnosed with atopic dermatitis. The need for additional clinical safety data in this population has increased due to requirements from the Food and Drug Administration (FDA) to generate data to support an Emergency Use Authorization (EUA) for IMVAMUNE(R). The additional clinical studies will be performed within the contract period, which has been extended until 2010. The value of the contract extension is $15 million.

Consolidated HIV vaccine strategy

Phase II data from the company's MVA HIV nef program showed proof of concept in the ability of the MVA technology to control HIV replication in certain patients. The data also indicates that a broader immune response is desirable in terms of optimizing control of HIV replication. As a result of recommendations from several Scientific Advisory Boards, Bavarian Nordic has therefore re-focused its HIV vaccine development strategy. Data from MVA HIV nef will now be incorporated into the company's MVA-BN(R) HIV multiantigen program which has the potential to meet the success criteria for an effective HIV vaccine. Going forward, Bavarian Nordic's HIV vaccine strategy will focus on the MVA-BN(R) HIV multiantigen program which is in development as both a prophylactic and therapeutic vaccine. A Phase I/II trial, investigating the safety and immunogenicity of MVA-BN(R) HIV multiantigen in HIV-infected patients, will be initiated during first half of 2008.

Childhood vaccine program - Measles vaccine enters clinical phase

Measles vaccines currently on the market are not optimal for use in children less than one year of age, an age group where most measles infections result in high morbidity and mortality. A significant reduction in childhood mortality could be achieved if safe and more effective vaccines could be developed for use in this vulnerable age group. Bavarian Nordic's preclinical studies have revealed that MVA-BN(R) is both safe and immunogenic in newborn animals. The MVA-BN(R) measles vaccine will be the first MVA-BN(R)-based childhood vaccine to evaluate the potential of the technology to induce satisfactory immune responses in children under the age of 1 year-old. This process will start with a Phase I study in adults to demonstrate safety, before evaluating the vaccine in children. Regulatory approval has been received and a Phase I study to evaluate safety and immunogencity of the vaccine in 30 healthy subjects has been initiated in South Africa. A clinical trial to evaluate the safety and efficacy in children is currently in the planning phase.

Cancer Immunotherapy

BN ImmunoTherapeutics, based in California, is progressing in its vaccine programs against breast and prostate cancer. MVA-BN(R)-HER2, an investigational vaccine for treatment of patients with breast cancer is in Phase I/II development. Currently patients with Her-2 positive, metastatic breast cancer are being enrolled in two clinical Phase I/II studies performed in three countries. The first study is ongoing in California. The second study is enrolling patients in multiple centers in Serbia and Poland. This study is accessing patient populations that have not received other treatment for metastatic breast cancer (e.g. Herceptin(R)). The first patients have been vaccinated with no significant adverse events reported. Initial immunogenicity data is expected in first-half of 2008.

BN ImmunoTherapeutics' program to develop a vaccine for treatment of patients with prostate cancer is expected to move forward in 2008. Preclinical studies have yielded results that are supportive for proceeding to clinical studies. A pre-IND meeting was held with the FDA to discuss the planned content of the IND application for the start clinical studies in USA. The company expects to receive approval of the IND before year-end. Clinical studies in patients with refractory prostate cancer are planned for first-half of 2008.

Development pipeline

Program Status Next milestone IMVAMUNE(R) (smallpox) II (x) Phase III (2008) HIV multiantigen Preclinical Phase I/II (H1, 2008) Breast cancer I/II Safety and immunogenicity data (H1, 2008) Prostate cancer Preclinical Phase I (H1, 2008) Measles I Initial immunogenicity data (H2, 2008) RSV Preclinical Phase I (2008)

(x) Sold to governments as a vaccine under development

The preceding are selected highlights of Bavarian Nordic's Interim Report for the period January 1 to September 30, 2007. The full results statement can be found on the company's website: http://www.bavarian-nordic.com.

About Bavarian Nordic

Bavarian Nordic, headquartered in Denmark, is a leading international biopharmaceutical company developing and producing innovative vaccines to prevent and treat infectious diseases and cancer.

In the U.S., Bavarian Nordic operates subsidiary companies, BN ImmunoTherapeutics, in Mountain View, California developing vaccines against cancers, and Bavarian Nordic Inc. in Washington, D.C. focused on business development, marketing, and government relations for the Bavarian Nordic Group. For more information on Bavarian Nordic visit: http://www.bavarian-nordic.com

"Safe Harbour" Statement under the Private Securities Litigation Reform Act of 1995": Except for the historical information contained herein, this release contains "forward-looking statements" within the meaning of the Private Securities Reform Act of 1995. No "forward-looking statement" can be guaranteed, and actual results may differ materially from those projected. Bavarian Nordic undertakes no obligation to publicly update any "forward-looking statement", whether as a result of new information, future events, or otherwise. Additional information regarding risks and uncertainties is set forth in the current Annual Report and in Bavarian Nordic's periodic reports, if any, which we incorporate by reference

Contact: Elizabeth Dempsey Becker, Bavarian Nordic Inc., +1-202-536-1576.