Alphavax, Novartis team on herpes vaccine

Triangle biotechnology company AlphaVax signed a $20 million partnership with Swiss drugmaker Novartis to continue developing an experimental vaccine for the cytomegalovirus, a type of herpes virus.

CMV infections can pass from mother to unborn child. Each year, about 30,000 babies are born infected and about 8,000 of them develop permanent disabilities, according to the Centers for Disease Control and Prevention.

No vaccine is on the market to prevent the infections, but at least one potential competitor is being tested in patients with weakened immune systems.

Novartis, which bought the rights to develop AlphaVax's CMV vaccine, has agreed to pay late-stage development costs and royalties on sales. Under the partnership, Novartis also could become an investor in AlphaVax.

"It was a great opportunity for us," said Janice Kimpel, AlphaVax's vice president of business development.

AlphaVax announced the Novartis deal Monday, saying the money will go into the development of its other programs.

Founded in 1997, AlphaVax has attracted more than $125 million, mostly in grants and private equity investments. But without product revenue and with three of its development programs in clinical trials, the company can use a corporate partner with deep pockets.

At the same time, large drugmakers are combing small biotech companies for promising potential products to offset slowing sales and increasing competition from generic medicines. The next few months are expected to be busy ones for acquisitions and partnerships in the pharmaceutical industry.

As part of its deal with AlphaVax, Novartis also acquired the rights to be first in line to negotiate a second partnership, for a respiratory virus vaccine that is still in animal testing.

Novartis has long followed AlphaVax's development progress, said Karen Huebscher, global head of business development and licensing at Novartis Vaccines and Diagnostics. Both companies have been working on similar technologies, but Novartis doesn't have a CMV vaccine in its development portfolio.

Considering the target patients -- transplant recipients and teenage girls -- the market for a CMV vaccine could be significant, Huebscher said. She declined to provide details.

Novartis has yet to decide where to manufacture the AlphaVax vaccine should it receive regulatory approval, she said. AlphaVax, which employs 69 in the Triangle and 11 at a manufacturing facility in Lenoir, will create the vaccine through Phase II testing.

The manufacturing plant Novartis is constructing in Holly Springs will not make the CMV vaccine should Novartis take on commercial production, Huebscher said.

That plant, which is expected to start production in 2010 and employ 350, will concentrate on flu vaccine.

Novartis will oversee development of the CMV vaccines from a global vaccine research headquarters it opened three months ago in Cambridge, Mass.