ID BIOMEDICAL READIES TO SELL INFLUENZA VACCINE TO U.S.

UNCLAS QUEBEC 000012

SIPDIS

STATE FOR WHA/CAN EWHEELER, EB/IPC SWILSON, OES/IHA HAROLD FOSTER
EB/TPP/BTA/EWH DSHEEHAN
FDA/CHARLES GAYLORD AND NAOMI KAWIN

E.O. 12958: N/A
TAGS: TBIO ETRD ECON PGOV CA
SUBJECT: ID BIOMEDICAL READIES TO SELL INFLUENZA VACCINE TO U.S.


Sensitive But Unclassified


1. (SBU) Summary: Late last year local and national media
widely reported the possible sale of Canadian flu vaccine
Flurival to the U.S. to offset shortages. Here is the current
state of play following our meeting with ID Biomedical, the
biotech company which is now well positioned to provide
influenza doses to the United States and whose manufacturing
plant is based in Quebec City. ID Biomedical officials
recently told us they did not end up selling to the U.S. in 2004
but were confident they would meet FDA requirements to supply
vaccines for the 2006 cycle, or perhaps as early as 2005. End
Summary.

2. (SBU) In November and December 2004 there was a flurry of
media reports on the shortage of flu vaccines in the U.S. and
the likelihood that Canadian ID Biomedical would sell its
surpluses to the U.S. On January 18, Consul General and
Pol/Econ Assistant met with company officials in Quebec City who
explained that they were unable to sell owing to required
adjustments to their production system (which they have now
made). At lunch, CEO Anthony Holler told us he had just come
back from Washington and had a very good meeting with FDA
Commissioner Crawford. He believed there was a strong
commitment on the American side to make the process move more
expeditiously and that the FDA understands the importance of
having more products made available faster.

3. (SBU) ID Biomedical gave us a tour of their facility
currently under construction so that they may double their
capacity and create sufficient flu shots to supply both the
Canadian and U.S. markets. The firm manufactures the influenza
vaccine Flurival and is Canada's main source of the vaccine with
approximately 75% of the public market. ID Biomedical calls
itself a North American company in what is a fully integrated
U.S.-Canada market. It currently has 450 employees with three
facilities in Canada (Quebec City, Vancouver and Montreal) and
two in the U.S. (Northborough MA, Bothell WA).


4. (SBU) At the beginning of the flu season last fall, the
company had 1.2 million excess doses of vaccine and was well
placed to sell its surpluses to the U.S., hustling to make up
for a unexpected shortfall caused by one of its suppliers,
Chiron Corp. Ultimately, ID Biomedical announced last December
that it would sell its remaining surplus doses of vaccine in
Canada, not the United States. Dr. Holler said they realized
selling the surplus to the U.S. would not help the company in
its bid to get accelerated licensing approval in that market,
and the decision was made to sell to Canadian purchasers. The
firm hopes to get an expedited FDA license early enough to sell
Flurival in the U.S. for next flu season: 10-15 million doses
that can be shipped as early as August of this year. The FDA
spent several weeks examining the company's clinical trials data
and inspecting the manufacturing process last year and ID
Biomedical officials believe their Quebec City plant now fully
meets U.S. requirements on this level. In late December 2004
clinical testing began.

5. (SBU) ID Biomedical has the current capacity to produce 5
million doses of flu vaccine and the expansion will allow them
to produce 50 million doses by 2007, 38-40 million of which
could go to the US. market. Holler said he has signed a
multi-year, multibillion-dollar contract with three U.S. vaccine
distributors (Henry Schein, Amerisource Bergen, and McKesson) to
deliver influenza vaccine stateside.

6. (SBU) Separately, ID Biomedical said they are also working
with the Canadian government on pandemic influenza vaccine that
has a highly deadly virus strain. It signed a ten-year mandate
until 2011 to assure a state of readiness should an influenza
pandemic breakout. The WHO is monitoring the global picture and
at the moment they are looking at Vietnam, where the avian flu
situation is highly unstable. ID Biomedical representatives
told us they are capable of stopping production to immediately
go into pandemic mode should this ever be necessary.



FRIEDMAN