Cangene has been awarded a five-year development and supply contract by the US Department of Health and Human Services (HHS) for 200,000 doses of heptavalent botulism antitoxin, in a deal worth up to $596m (€462m).
The drug is a botulinum toxin immune globulin for the treatment of those exposed to the bacteria or the toxin that causes botulism, a serious paralytic illness.
As fears of bioterrorism in the US increase, the government has allocated $5.6bn under Project Bioshield to develop and make available effective drugs and vaccines to protect against attack by biological and chemical weapons, so pharmaceutical manufacturers are positioning themselves for lucrative contracts.
Cangene has already begun development work on the project under an earlier research and development contract with the US Centers for Disease Control and Prevention,
Under this new contract, Cangene will begin to receive payment once it has produced and delivered a quantity of "usable product" to the US Strategic National Stockpile, expected from mid to late 2007.
To meet the "usable product" requirement, the product must be manufactured under licensable conditions and meet certain safety and regulatory conditions.
Once licensure from the US Food and Drug Administration (FDA) for use of the product is received, Cangene may receive a supplemental payment.
Apart from the $362m base contract, optional task orders of $234m are up for grabs, awarded at the government's discretion.
These tasks include ongoing testing to support long-term product shelf life, maintaining product manufacturing, and additional clinical testing in special populations.
"Botulinum toxins are one of the bioterrorist weapons that has been determined by the US Department of Homeland Security to be a material threat to national security," said Cangene CEO John Langstaff.
"Cangene has been working hard to develop a product that can help build an effective defence against this toxin and we look forward to continuing to work with HHS on this effort."
Cangene will manufacture the product at its Winnipeg facility but will use its US subsidiaries and other US companies for all key subcontracting activities.
The company already has ample experience in the production of immune globulins like botulism antitoxin; it has been manufacturing its WinRho SDF hyperimmune, a purified preparation of specific immune globulins isolated from blood plasma, for 25 years.
Thus, Cangene's immune globulin products tend to enter the regulatory process at a more advanced stage, shortening the development time.
In the current climate of uncertainty in world affairs, the company's development efforts have been concentrated on developing products with infectious disease and bioterrorism targets.