Enzychem Lifesciences recently corrected its registration statement to mention risks in Covid-19 vaccine manufacturing before a bonus issue, arousing questions about whether the vaccine manufacturing will be a boon for the company.
The biotech company hopes that making an Indian drugmaker’s Covid-19 vaccine, which won the world’s first approval, could raise earnings and help the company become a significant global supplier of a Covid-19 vaccine.
However, the company also mentioned risks and challenges, questioning whether its latest decision was beneficial.
On Friday, Enzychem revised its registration statement, the sixth revision, before issuing free shares in late January 2022.
The latest update included the company’s conservative view on manufacturing a Covid-19 vaccine.
Earlier, Enzychem signed a deal with Indian drugmaker Zydus Cadila to produce plasmid DNA (pDNA) Covid-19 vaccine ZyCoV-D.
Zydus Cadila developed the DNA-based Covid-19 vaccine for the first time in August and received emergency use authorization in India.
Under the agreement, Enzychem will manufacture drug substance (DS) and drug product (DP) of ZyCoV-D in Korea.
The company announced a plan to form a local consortium and expand production facilities.
Enzychem aims to manufacture 80 million doses of ZyCoV-D annually.
However, the Friday revision of the registration statement showed that a vaccine supply required many procedures, such as winning local approval.
“To sell the vaccine, the marketing license is required in each region, and the vaccine license is not available in countries where the company can sell the vaccine. Therefore, additional processes are required to win approval,” Enzychem Lifesciences said.
Even if a regulatory agency starts a license review, there is a possibility that the permit could be delayed or the vaccine may not be able to obtain the permit, which can negatively affect Enzychem’s new business, the company went on to say.
“Also, although the company paid the license fee, low sales of the vaccine can hurt the company’s profitability.”
Enzychem Lifesciences made a $3.5 million upfront payment to Zydus Cadila, according to the registration statement. In addition, the company will pay a $3.5 million licensing-in fee and $20 million royalties with funds raised through a bonus issue.
“We must pay $20 million royalties annually, regardless of the sales of the vaccine. So if our vaccine sales are sluggish, the royalties may become a fixed cost,” Enzychem said.
Enzychem also said that while most Covid-19 vaccines authorized in Korea are mRNA vaccines, the Ministry of Food and Drug Safety may require additional data for the ZyCoV-D vaccine because the regulator has never reviewed non-clinical, clinical, and quality data of a pDNA Covid-19 vaccine.
Most of the clinical data of the MFDS-authorized Covid-19 vaccines were based on the clinical data approved by the U.S. FDA. Still, Enzychem collected data reviewed by the Drug Controller General of India (DCGI) and will seek the MFDS approval for marketing approval, it said.
“The MFDS could view that our data are insufficient compared to those reviewed by the FDA. In this case, there could be glitches and delays in the vaccine approval.”
On Dec. 6, the company had been confident about ZyCoV-D, saying the company could develop a platform in eight weeks for ZyCoV-D to fight the Omicron variant.
Enzychem aims to become a global supplier of ZyCoV-D. The licensing-in deal secured exclusive ZyCoV-D sales rights in eight countries – Korea, Indonesia, Vietnam, the Philippines, Malaysia, Bangladesh, Brunei, and Argentina. The contract will be valid for three years, plus two extended years.