The U.S. government has agreed to purchase 20,000 courses of a treatment for inhalation anthrax from

Human Genome Sciences

(HGSI)

. The doses will be part of a national stockpile.

Following delivery and licensing of the drug, which goes by the brand name ABthrax, the company will receive about $165 million in revenue from the deal.

"We believe that ABthrax offers a significant step forward in the treatment of inhalational anthrax disease," CEO H. Thomas Watkins said in a company statement. "Today's announcement is an important milestone in Human Genome Sciences' progress toward commercialization, since fulfilling the terms of this award will result in our company's first product sales," he said.

The Rockville, Md.-based company says it will manufacture and deliver the treatments to the Strategic National Stockpile and conduct additional tests to support its application to the Food and Drug Administration for the drug's use in patients with inhalational anthrax in an emergency prior to FDA licensure.

The sales agreement follows Department of Health and Human Services testing, in addition to Human Genome Sciences' own animal studies and early human trials designed to determine the treatment's safety and tolerability.

Antibiotics and vaccines are already used to prevent or treat inhalation anthrax, but ABthrax, which is a monoclonal antibody, represents a third option, Dr. David Stump, Human Genome's executive vice president of drug development, said during the company's conference call Tuesday.

According to Stump, antibiotics can kill bacteria, but not the toxins that cause anthrax deaths. ABthrax effectively blocks the effects of the toxin, and unlike the other treatments, protection from the disease would be immediate, he says.

While the government stockpile calls for 20,000 doses of the ABthrax, "there are certainly possibilities for orders beyond this, including international possibilities," the company says.

"We will continue to talk to key allies of the U.S. that would be interested in having a product like this," Jim Davis, the company's general counsel, said.

After scaling up production of the drug, Human Genome Sciences says it expects to deliver its government stockpile in 2008.

Before ABthrax receives FDA approval however, the company says it may be required to conduct further clinical trials to confirm the treatment's efficacy, its safety in healthy volunteers, and to study its effects on antibiotics and vaccines.

Shares were up 16 cents, or 1.6%, to $9.96 in recent trading.