Shares of

ID Biomedical

(IDBE)

advanced Tuesday after the Canadian vaccine maker said the U.S. Food and Drug Administration granted an accelerated review of its flu vaccine.

The Fluviral vaccine wouldn't be ready for the upcoming U.S. flu season, but quick FDA approval could ensure there would be supplies for the next flu season.

If ID Biomedical enters the U.S. market, it would add another supply source and reduce the risk of shortages, as was the case last year when manufacturing problems at a

Chiron

(CHIR) - Get Report

plant sharply reduced the amount of available vaccine.

In securing "fast track review," ID Biomedical hopes to obtain FDA approval by April 1. The company has distribution deals with three major U.S. distributors to buy and distribute 38 million doses of the Fluviral annually beginning in the 2007-2008 season. If ID Biomedical gets FDA clearance by April 1, the agreement will apply to the 2006-2007 season. ID Biomedical now provides 75% of the flu vaccine purchased by the Canadian government.

Shares of ID Biomedical rose 92 cents, or 5.2%, to $18.52 in early afternoon trading Tuesday.

For U.S. patients, FDA approval of Fluviral will mean an additional 20 million to 25 million flu shots during the 2006-2007 season and 40 million shots for the 2007-2008 season.

ID Biomedical would be joining the U.S. market leader,

Sanofi-Aventis

(SNY) - Get Report

and

MedImmune

(MEDI)

, maker of the nasal spray vaccine FluMist.

In addition,

GlaxoSmithKline

(GSK) - Get Report

is seeking to enter the U.S. for the current flu season. GlaxoSmithKline is expected to make about 10 million doses, Sanofi-Aventis will provide about 60 million and MedImmune will contribute about 3 million.

Chiron says it has solved its manufacturing problems at its flu-vaccine plant in the United Kingdom. In March, British health authorities gave the company permission to resume manufacturing, but Chiron won't sell a single vial of vaccine in the U.S.

unless the FDA approves the plant's operations. The FDA is supposed to rule soon. Still, Chiron has cut its production forecast for the 2005-2006 season to a range of 18 million to 26 million doses.

If all of the manufacturers make good on their promises, the supply of vaccine should be adequate for U.S. needs this season.

In a related matter, ID Biomedical, based in Vancouver, British Columbia, said Tuesday the expansion and improvement of its vaccine plants in Quebec is on schedule. The upgrades will enable ID Biomedical to expand production capacity to 75 million doses a year from 50 million.