The CSL Limited (ASX: CSL) share price is pushing higher on Monday after making a major COVID-19 announcement.
At the time of writing the biotherapeutics company's shares are up 1% to $281.56.
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What did CSL announce?
This morning CSL announced that it has signed a heads of agreement with the Australian Government to supply 51 million doses of University of Queensland's potential UQ-CSL V451 COVID-19 vaccine to Australia. The first doses are scheduled for release from mid-2021 following successful clinical trials.
A separate heads of agreement has been signed between CSL and AstraZeneca for the expected manufacture of approximately 30 million doses of the Oxford University vaccine candidate AZD1222 for supply to Australia. The first doses of this alternative vaccine are scheduled for release early 2021, following successful clinical trials.
In addition to this, the company has signed a funding deed with the Australian Government in order to ready its facilities for the manufacture of the AZD1222 vaccine candidate, and provide an additional COVID-19 vaccine option for Australians.
CSL's CEO & Managing Director, Paul Perreault, commented: "The social and economic impact of the COVID-19 pandemic has brought a high level of urgency to the task of developing a vaccine against the SARS-CoV-2 virus, and to manufacture a successful vaccine at high quality and in sufficient quantities."
"CSL has been working at pace to respond to the pandemic and has invested significant resources in the rapid development and large-scale manufacture of UQ-CSL V451, along with a number of other therapeutic programs."
"Together with partners including the University of Queensland and Coalition for Epidemic Preparedness (CEPI), our development and manufacturing teams have been working extremely hard to advance this program to ensure the availability of a safe and effective vaccine should clinical studies prove successful," he added.
The company's influenza vaccines business, Seqirus, will hold regulatory responsibility as the marketing authorisation holder. Production of the vaccine to support late stage clinical trials has commenced at CSL's biotech manufacturing facilities in Broadmeadows, Melbourne.
Will these vaccines work?
Although the results from the pre-clinical and early clinical studies for UQ-CSL V451 are very promising, management warned that it is impossible to predict the level of success the candidate will have in late stage clinical trials.
"CSL's focus is to produce a safe and effective vaccine. It is important that on completion of clinical trials, the public has confidence in UQ-CSL V451, which makes use of the well-established recombinant protein technology platform, and Seqirus' proprietary adjuvant MF59, which has an extensive safety track record in humans," Mr Perreault said.
The same applies for AZD1222. Its early trials have been very promising, but it is not a guarantee of future success.
Will CSL's other businesses be disrupted?
Despite taking on the mammoth task of manufacturing tens of millions of doses of the AZD1222 vaccine, CSL's manufacturing of its current product portfolio will not be disrupted.
Mr Perreault explained: "We are pleased that we can produce the AZD11222 without compromising the production of our core products – influenza vaccines and plasma and recombinant protein therapies – and provide a second option for a COVID-19 vaccine candidate to Australia."
"Acknowledging that CSL is the only company in Australia with manufacturing facilities capable of producing this vaccine, we thank the Australian Government for their support, ensuring Australia has access to onshore COVID-19 vaccine production and supply. Our facilities will require modifications in order to fulfil the compliance requirements for working with vector-based vaccines, as well as the addition of skilled personnel and further capital investment.," he concluded.
