CureVac (NASDAQ:CVAC) stock is on the rise Wednesday after the company announced a restructured licensing agreement with GSK (NYSE:GSK).
This new agreement has GSK taking over the development and manufacturing of certain vaccines made by CureVac. That includes its candidates for seasonal influenza, COVID-19 and avian influenza. Each of the vaccines in this deal is based on CureVac’s mRNA technology.
With this agreement, GSK will also hold the worldwide rights to commercialize the vaccines included in the deal. It also replaces the previous licensing agreements between the two companies.
With this deal, CureVac is getting an upfront payment of 400 million euros from GSK. The deal also includes up to 1.05 billion euros in development, regulatory and sales milestones. Royalties for the agreement are in the high single to low teens range.
CVAC Stock: More Changes at CureVac
Following this announcement, CureVac also revealed plans for a restructuring to streamline its business. This has the company planning to cut 30% of its workforce.
CureVac says these changes will result in a more than 30% drop in operating costs starting in 2025. It also mentions that charges suffered from the layoffs will come to 15 million euros. This will give it a cash runway into 2028.
CVAC stock is up 1.5% as of Wednesday morning.
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
