The recent influenza season hit early and hard, and raised the profile of a small biotechnology company in Emeryville, Calif.
Chiron Corp. became the nation's second-largest producer of flu vaccines last year, thanks to its acquisition of PowderJect Pharmaceuticals of Cambridge, England. The deal added $245 million to Chiron's revenue in 2003, when it sold its entire flu vaccine inventory -- including 38.4 million doses in the U.S.
And Chiron believes the global flu vaccine market could double to $2.6 billion in the next decade, driven by a federal target of 150 million annual U.S. vaccinations. To meet the demand, the company needs to boost production of vaccine, now grown in chicken eggs.
Chief Executive Howard Pien told analysts last month that Chiron's vaccine sales should reach $1.3 billion by 2008, exceeding the projected sales of the company's blood-testing equipment or biotech drugs.
Pien talked with The Times last week about the vaccine business.
Question: There was a severe shortage of vaccine during this past flu season. A year ago, your competitor, Aventis, threw out vaccine it couldn't sell. What can be done to prevent supply imbalances next flu season?
Answer: It is very difficult to address the supply issue in the short run. In the longer run, it is possible. We are investing $100 million in our flu vaccine business, not just to put up machines and factories but to come up with a more efficient way of making vaccines in chicken eggs.
The next frontier is a new production method called cell culture. It is going to be very important. It may not represent a safety or efficacy advantage over chicken egg-derived vaccine, but it has the potential to reduce the time needed to produce vaccine, allowing manufacturers to respond to spikes in demand.
Q: You currently are testing the cell culture method, which involves growing the vaccine in cells rather than in eggs. If the test is successful, when will you begin using the new production technique? How much production time will it save?
A: The general estimate for a vaccine product is that it takes five to six years to develop it for the market. It is entirely possible we will do this faster, but that is assuming our test is very, very positive. Currently, it takes four months to make flu vaccine in chicken eggs. We believe that time can be reduced by 50%. The net effect will be to increase output.
