COVID vaccine and Kymriah news encouraging

Oxford Biomedica 5 July 2022 Flash note
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Oxford Biomedica

COVID vaccine and Kymriah news encouraging

Q122 update

Pharma and biotech

5 July 2022



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Net cash (£m) at end FY21


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Business description

Oxford Biomedica’s LentiVector technology supports its internal initiatives and allows it to generate significant revenue from a multitude of partners. It is implementing significant capacity upgrades to improve efficiency and support more partnering/out-licensing agreements.


Soo Romanoff

+44 (0)20 3077 5700

Dr Adam McCarter

+44 (0)20 3077 5740

Oxford Biomedica is a research client of Edison Investment Research Limited

Oxford Biomedica (OXB) announced that it has signed a new three-year Master Services and Development Agreement with AstraZeneca (AZN) for future production of the AZN COVID-19 vaccine. As an expansion of the original agreement signed in September 2020, AZN will now have access to OXB’s world-class Oxbox manufacturing facilities on an as-needed basis from the start of 2023. Management expects revenues of approximately £30m from AZN in FY22 for batches of the vaccine already manufactured in 2022 under the original agreement. In addition, Novartis recently announced encouraging five-year follow-up data from the ELIANA clinical trial investigating the use of Kymriah in the treatment of relapsed or refractory (r/r) B-cell acute lymphoblastic leukaemia (ALL). OXB is the sole global supplier of lentiviral vector for Kymriah. We view both announcements as a positive for OXB’s future revenues. Our valuation and forecasts are currently under review.

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Note: *Reported.

The AZN COVID-19 deal has buoyed OXB’s revenues in recent years. It reported FY21 revenue of £142.8m, up 63% from £87.7m in FY20, and generated an operating profit of £20.8m (FY20: £5.69m loss), which management largely attributes to manufacturing revenues from the AZN deal. The newly expanded deal will operate on an as-needed basis beyond 2022, making future revenues from the new agreement hard to predict. However, we see the commitment to a continued business relationship by both parties as an encouraging development. In our view, the emergence of new COVID-19 variants and rising cases worldwide suggests that demand for COVID vaccines will be relevant at least in the near term.

OXB plays a pivotal role in manufacturing Novartis’s marketed therapy, Kymriah. In December 2021, the two companies entered into a long-term commercial supply agreement in which OXB will continue to supply its LentiVector platform technology for the production of the CAR-T therapy until 2028, as well as continuing to work on other CAR-T programmes. For the 79 patients treated in the Phase II ELIANA trial (NCT02435849) in ALL, the overall remission rate was positive, with 82% experiencing remission within three months after infusion. Five-year follow up data now show that 55% of patients survived for more than five years and 44% of patients who experienced remission within the first three months remained in remission at the five-year mark. Median relapse-free survival of 43 months and median event-free survival of 43.8 months were also reported, demonstrating the treatment’s longevity and curative potential.

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