Vical rises 10% premarket after reaching NIH milestones (VICL)

Posted in General, pre-market 
June 18th, 2009

Vical (VICL) shares are up 10% premarket and have nearly traded a tenth of its average daily volume ahead of the open.

The company announced this morning that has achieved second-year milestones under a 3-year, $6 million grant from the National Institutes of Health — a potential gateway to Vical getting more government funding.

The company also said it’s still advancing with development of its RapidResponse system that it hopes will eventually be able to produce several million doses of vaccines quickly in the event of a pandemic.

While the continued NIH grant is a small amount of money, it validates RapidResponse as a potential delivery system for vaccines that might protect against infectious diseases such as swine flu, bird flu, ebola, West Nile, SARS, or another yet-to-be-discovered pandemic threat.

Vical already has a partnership with the U.S. Navy to make a prototype DNA vaccine targeting swine flu; it would benefit strongly from additional government dollars that would help speed clinical development and boost potential vaccine production.

As advertised, the company’s delivery system’s major potential advantage is speed. The traditional method of making vaccines is to build a gigantic facility that grows viruses in chicken eggs or cell cultures for use in drugs. The Vical RapidResponse DNA vaccine process is cell-free, and in theory could help make hundreds of millions of vaccine doses in the early stages of a disease outbreak. There are also potential safety benefits, as the system doesn’t require injection of a live or partially-killed virus.

The delivery system has yet-to-be-tested in humans. But companies such as Novartis’ (NVS) Aqua Health have used Vical’s technology in farm-raised salmon, and Wyeth’s (WYE) Fort Dodge Animal Health Group have used a DNA-based vaccine technology in horses.

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