Novartis announced the expansion of its late-stage vaccines pipeline through an agreement to acquire marketing and distribution rights for IC51, a vaccine in phase III clinical trials for the prevention of infections from the Japanese Encephalitis virus.

With this agreement, Novartis will gain the rights to the future commercialization of IC51, which received orphan status from the European regulatory agency earlier this year. Novartis has the rights to IC51 for the United States, Europe and certain other markets including Asia and Latin America, except for markets where Intercell has pre-existing agreements. Submission for US approval is anticipated to start in the second half of 2006. This vaccine will complement the company's offering of vaccines for travellers to endemic countries.

Novartis will make an equity investment in Intercell of up to EUR 30 million, which grants Novartis the first negotiation rights to certain existing product candidates derived from Intercell's technology, and also milestone payments related to IC51 for final phase III data as well as US and EU regulatory approvals, which are assumed to occur in 2007 and 2008, respectively.

"Novartis Vaccines is committed to disease prevention and strengthening its leadership position in human vaccines," said Dr. Jörg Reinhardt, CEO of Novartis Vaccines & Diagnostics. "No effective treatment is currently approved to prevent the debilitating effects of Japanese Encephalitis, leaving an urgent need for new vaccines such as IC51. This agreement reinforces our commitment to develop innovative vaccines through our own development activities as well as strategic partnerships."

Japanese Encephalitis (JE) disease is an acute inflammatory condition of the brain and spinal cord caused by the Japanese Encephalitis virus (JEV), which is transmitted by mosquitoes that transmit the virus from infected animals, mostly domestic pigs, to humans at seasonal intervals. JE is a leading cause of viral encephalitis in Asia with 30,000 to 50,000 clinical cases reported annually.

IC51 is a second-generation JE vaccine that leverages cell culture technology with the aim of providing an effective but safer product compared to the currently available vaccine, which was developed in the 1950s and is made from a virulent strain of the JE virus (Nakayama strain) and propagated in mouse brains and then formulated with stabilizers and thimerosal.

IC51 is produced using an attenuated virus strain and mammalian cell culture technology. Formulation is completed with an adjuvant (aluminum hydroxide) to increase potency but without stabilizers and thimerosal.

This vaccine complements the Novartis portfolio of travel vaccines, which includes Encepur vaccine, a vaccine against tick-borne encephalitis (TBE); Rabipur/RabAvert vaccine, an effective pre-exposure and post-exposure prophylaxis treatment against rabies; Typhoral L vaccine, an oral typhoid vaccine; HAVpur vaccine, for the prevention of Hepatitis A; and Dukoral vaccine to prevent cholera.

Japanese encephalitis (JE) is a disease caused by a virus that affects the membranes around the brain. Most JE virus infections are mild (fever and headache) or without apparent symptoms, but approximately one in 200 infections results in severe disease characterized by rapid onset of high fever, headache, neck stiffness, disorientation, coma, seizures, spastic paralysis and death. According to the WHO, the fatality rate can be as high as 60 per cent among those with disease symptoms; 30 per cent of those who survive suffer from lasting damage to the central nervous system. In areas where the JE virus is common, encephalitis occurs mainly in young children because older children and adults have already been infected and are immune.

The virus is transmitted by mosquitoes that breed particularly in flooded rice fields. The virus circulates in birds such as herons and egrets. Pigs are amplifying hosts, in that the virus reproduces in pigs and infects mosquitoes that take blood meals, but does not cause disease.

Japanese encephalitis occurs from the islands of the Western Pacific in the east to the Pakistani border in the west, and from Korea in the north to Papua New Guinea in the south. JE distribution is very significantly linked to irrigated rice production combined with pig rearing.

Immunization in Europe and the US is currently recommended for travellers who visit countries where JE is prevalent and stay there for more than four weeks, predominantly in rural areas. This restrictive recommendation is influenced by the fact that health care specialists are concerned about the safety of the currently available prevention options.