Oxford Biomedica warns on sales after pausing AstraZeneca COVID vaccine

·Business Reporter, Yahoo Finance UK
·2-min read
Oxford Biomedica manufactured the COVID jab throughout the pandemic
Oxford Biomedica manufactured the COVID jab throughout the pandemic, and is in talks with Astra about a possible extension to their supply agreement. Photo: Artur Widak/NurPhoto via Getty

Oxford Biomedica (OXB.L) slumped as much as 7% on Wednesday after it warned its revenue will suffer this year as it halts the manufacturing of AstraZeneca’s (AZN.L) COVID vaccine.

The company, which manufactured the jab throughout the pandemic, said it was in talks with Astra about a possible extension to their supply agreement.

However, it warned it would swing to a loss this year due to the pause, and costs related to its new business in the US.

It said it would post an operating loss before interest, tax, depreciation and amortisation, from an operating EBITDA of £35.9m in 2021.

This is driven by one-off costs for integrating the new business, as well as R&D costs, which are targeted to be higher than in 2021 as the group invests in innovation, it said.

The London-listed cell and gene therapy group has seen its sales jump in recent years thanks to the health crisis, pulling in £142.8m ($186m) in the year to 31 December, up from £87.7m in 2020.

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Dr Roch Doliveux, interim chief executive and chair, hailed the firm’s “exceptional” performance, which also saw it produce more than 100 million doses of the vaccine over the course of the partnership with AstraZeneca.

But revenues from milestones, licences and royalties, which included recognition of the £4m licence fee from Boehringer Ingelheim, decreased 25% to £14.4m.

Investors dumped shares in the company on the back of the news, which sent it to the bottom of the FTSE 250 (^FTMC).

Oxford Biomedica stock fell on Wednesday. Chart: Yahoo Finance
Oxford Biomedica stock fell on Wednesday. Chart: Yahoo Finance

Oxford Biomedica has since agreed two new partnerships with fellow biotech companies Immatics and Arcellx, after its commercial and bioprocessing revenues surged nearly 90% in the 12-month period.

“2022 will be another important year as we execute on our strategy to become a global viral vector leader, providing life-changing therapies and vaccines to patients,” Doliveuxin said.

“With the outsourced vector manufacturing supply market growing rapidly, we see significant potential to build upon our success with lentiviral vectors and expand the scope of our innovative process development and manufacturing to all classes of viral vectors.”

Viral vectors are tools which are used to deliver genetic material to cells. They can be used for gene therapies and vaccine development.

Watch: Oxford Biomedica CEO on Covid-19 Vaccine, Industry Outlook

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