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news.Biodefense vaccines developer VaxGen has acquired all of the shares in its California manufacturing facility that it did not already own from its joint venture partner, Celltrion, for $7.7 million. VaxGen has also restructured its agreements with Celltrion and South Korean joint venture partners.
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In February 2002, VaxGen and a group of South Korean investors formed Celltrion, a South Korean joint venture, to establish a large-scale biopharmaceutical manufacturing business in South Korea. VaxGen provided technical support and know-how, and the South Korean investors provided all of the funding for the joint venture.
Celltrion has nearly completed the mechanical construction of its 50,000-liter facility in Incheon, South Korea, designed for the production of biopharmaceuticals grown in mammalian cells, which include many of the most advanced products made through biotechnology. Celltrion is actively pursuing contract manufacturing business and has entered into early-stage negotiations with potential customers.
VaxGen and Celltrion also formed a joint venture in February 2002 called VaxGen-Celltrion Inc to establish a multipurpose manufacturing facility in California. Celltrion provided VaxGen-Celltrion with $7 million in initial capital, with all remaining construction and operating costs borne by VaxGen.
The VaxGen-Celltrion facility, which is now under the sole ownership of VaxGen, was initially used to train Celltrion staff in cGMP compliant biopharmaceutical manufacturing. The facility is in full cGMP operation and is producing recombinant protein antigen for VaxGen’s anthrax vaccine, rPA102.
“The buy-out of the remaining interest in our manufacturing facility benefits VaxGen and Celltrion,” said Lance Gordon, VaxGen’s president and CEO. “It ensures VaxGen’s complete control of its own manufacturing facility and provides Celltrion with non-dilutive operating capital for its operations in South Korea.”
VaxGen also announced that it has revised its relationship with Celltrion and its South Korean joint venture partners. VaxGen will reduce its ownership in the joint venture from 48% to 36%, although VaxGen will still be the single largest stockholder in the joint venture and will continue to hold two seats on Celltrion’s board of directors.
“Restructuring our relationship with Celltrion is a natural outgrowth of VaxGen’s evolution and its growing presence in biodefense,” Gordon said. “VaxGen retains a significant stake in Celltrion, and we intend to continue to provide whatever support we can to help ensure its growth and success. We applaud the progress that Celltrion has made and look forward to a continuing and active role in the joint venture.”
In exchange for reducing its ownership in Celltrion, VaxGen will have no future obligation to transfer additional technology or to provide additional technical support to Celltrion. However, Celltrion will have the ability to request further technical support and certain services from VaxGen. Celltrion also will have the right to continue to use certain technology previously transferred to it by VaxGen.