merial deal ready, set,.. Imugene has done some further work on...

merial deal ready, set,.. Imugene has done some further work on what it understands to be the markets into
which its viral vectors would be sold by Merial. The current market for pig health has now been estimated at
US$3.4bn, of which US$285m represents the amount currently spent by pig farmers on 'biological' products like
those Imugene is seeking to commercialise, and US$1.04bn represents the current market for 'medicinal feed
additives', that is, the antibiotics now being phased out of animal health worldwide
due to the increasing capacity of microbes to not be killed by the drugs. With the
biologicals market likely to subsume the antibiotics market over the next few years
there’s a fairly attractive market opportunity for the likes of Imugene’s porcine
adenoviral vector. For chickens, Imugene estimates that the entire health products
market is something like US$3.14bn, of which US$550m is spent on biologicals and
US$650m on antibiotics. With pigs the larger market of the two, Imugene is putting
more effort into porcine applications, working in particular on vaccines for the
abovementioned Porcine Reproductive and Respiratory Syndrome (a disease for
which there is currently a vaccine in the market but which Imugene reckons it can
beat), and adding an effort to go after porcine foot and mouth disease. Imugene’s
current figures on market size are a little more conservative than those we were
working with a few months ago, where Imugene estimated the pig and chicken markets to be perhaps US$4.8bn and
US$4.3bn respectively. On the other hand our assumptions on market size, product launches and royalty rates were
fairly conservative at that time, so we don’t feel the need to change our valuation of Imugene’s adenoviral vectors at
this stage.
Imugene has
affirmed that it
enjoys Merial’s
strong
commitment and
support.
Imugene’s
adenoviral
vectors will sell
into markets
worth US$3-
3.5bn for both
pigs and chickens