Johnson & Johnson (JNJ) - Get Report shares spiked higher Wednesday after the drugmaker and healthcare group said it reached an agreement with the U.S. government to provide 100 million doses of its potential coronavirus vaccine.
Johnson & Johnson said the provisional agreement would see the production and distribution of 100 million doses of the Janssen SARS-CoV-2 investigational vaccine, in exchange for a payment of around $1 bilion..
Last month, a U.S. government-backed study, published in Nature magazine, showed that all monkeys exposed to the virus candidate were protected against infection with SARS-CoV-2, the virus that causes COVID-19. The dose also elicited a "robust immune response", with neutralizing antibodies, in the non-human patients, Johnson & Johnson said.
"Johnson & Johnson's global team of experts has worked tirelessly alongside BARDA and scientific partners to pursue a SARS-CoV-2 vaccine that can help to stop the spread of COVID-19," said Johnson & Johnson's chief scientific officer Paul Stoffels. "We greatly appreciate the U.S. government's confidence in, and support for, our R&D platform and efforts and the scalability of our vaccine technology. We are scaling up production in the U.S. and worldwide to deliver a SARS-CoV-2 vaccine for emergency use."
Johnson & Johnson shares were marked 1.25% higher in early trading following the release of the government contract details at $148.90 each, a move that would bump the stock's year-to-date gain to around 2.7%.
Last month, Johnson & Johnson said it will also conduct a parallel study to its single-dose human trials with one focusing on double-doses, and reiterated its aim of producing and supplying more than one billion doses of the vaccine -- should it be approved by regulators -- through the course of 2021.
"As we collectively battle this pandemic, we remain deeply committed to our goal of providing a safe and effective vaccine to the world," said Dr. Mathai Mammen, who heads Johnson & Johnson's Janssen Research & Development LLC. "Our pre-clinical results give us reason to be optimistic as we initiate our first-in-human clinical trial, and we are excited to enter the next stage in our research and development toward a COVID-19 vaccine."
"We know that, if successful, this vaccine can be rapidly developed, produced on a large scale and delivered around the world,' he added