Nabi Biopharmaceuticals has granted an exclusive worldwide license to its whole cell vaccine technology for the prevention and treatment of Staphylococcus aureus infections in cattle to Pharmacia Animal Health. Under the license agreement, Pharmacia Animal Health has made an upfront cash payment and will make future cash payments if certain milestones are achieved. Pharmacia Animal Health will also pay royalties based upon product sales once regulatory approval to market the vaccine is obtained. Detailed financial terms of the agreement were not disclosed.

The agreement covers Nabi Biopharmaceuticals' patent and other intellectual property rights to its veterinary Staphylococcus aureus vaccine, including the method of vaccine preparation and its use as a therapeutic or prophylactic agent to protect animals against infection. The vaccine is being developed to provide protection from the three S. aureus strains (types 5, 8, and 336) that comprise more than 98% of the S. aureus isolates found to cause mastitis in cattle. The technology covered by this license is the subject of two U.S. patents issued to Nabi Biopharmaceuticals and patent applications worldwide. The licensed technology is an extension of the StaphVAX? (S. aureus polysaccharide conjugate vaccine) technology that is currently in late stages of clinical development by Nabi Biopharmaceuticals for the prevention of staphylococcal infections in humans.

David Gury, Nabi Biopharmaceuticals' chairman and chief executive officer, said, "We are extremely pleased to license the rights to our S. aureus whole cell veterinary vaccine technology to Pharmacia Animal Health, a leading provider of animal health care products. Staph infections in cattle are an enormous global problem. Our S. aureus veterinary vaccine technology represents an important advance toward effectively preventing and treating costly mastitis that can significantly affect the health and productivity of dairy and beef cattle. This agreement underscores the significance of this problem. It allows us to leverage the value of our gram-positive vaccine technology in dealing with important veterinary issues around food safety and animal health while we continue to focus our resources on the human health challenges associated with staph bacterial infections. By signing this agreement, we are maximizing the return to Nabi Biopharmaceuticals shareholders on this novel application of our vaccine technology."

In a collaborative study between researchers at Nabi Biopharmaceuticals, the U.S. Department of Agriculture and Michigan State University, the company's trivalent vaccine technology demonstrated the ability to clear chronic intramammary infections with S. aureus in dairy cows. Staphylococcus aureus infection is one of the most frequent causes of mastitis, a common and costly disease affecting dairy and beef cattle. Mastitis results in significantly higher costs for producers of dairy and beef products due to discarded milk, decreased productivity, treatment expense, and the inability of infected cows to suckle calves. The U.S. National Mastitis Council estimates that the annual losses to the dairy industry amount to 1.8 to 2 billion dollars.