CVAC share alert: CureVac rises after license agreement with GSK

CureVac (NASDAQ:CVAC) shares rise on Wednesday after the company signed a restructured licensing agreement with GSK (NYSE:GSK).

Under this new agreement, GSK will develop and manufacture certain of CureVac’s vaccines, including candidates for seasonal influenza, COVID-19 and avian influenza. Each of the vaccines in this agreement is based on CureVac’s mRNA technology.

This agreement also gives GSK the worldwide rights to commercialize the vaccines included in the contract and replaces the previous licensing agreements between the two companies.

Under this agreement, CureVac will receive an upfront payment of EUR 400 million from GSK. The agreement also includes up to EUR 1.05 billion for development, regulatory and sales milestones. The royalties for the agreement are in the high single-digit to low double-digit range.

CVAC share: Further changes at CureVac

Following this announcement, CureVac also revealed plans for restructuring to streamline its business. The company plans to cut 30% of its workforce.

CureVac says that these changes will result in a reduction in operating costs of more than 30% starting in 2025. The company also mentions that the costs incurred by the layoffs will amount to 15 million euros. This will provide the company with liquidity headroom until 2028.

CVAC shares are up 1.5% since Wednesday morning.

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At the time of publication, William White had no position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the author and are subject to InvestorPlace.com Publishing guidelines.