Oxford Biomedica PLC (LON:OXB), a key manufacturer of what is known as the Oxford/AstraZeneca PLC (LON:AZN) COVID-19 vaccine, has doubled revenue expectations.
The pair signed an 18-month supply agreement in September 2020.
READ: Oxford Biomedica 'buy' recommendation reiterated as COVID-19 vaccine manufacturer's revenues soar
The gene and cell therapy group said the FTSE 100 group increased the number of batches required for the jab in the second half.
As a result, Oxford Biomedica estimates revenues the contract to be £100mln, instead of previous forecasts of £50mln.
It also expects significant growth in group operating underlying earnings (EBITDA) this year.
As previously guided, Oxford Biomedica does not expect the commitment to AstraZeneca for vaccine production to have any impact on its current partnerships or ability to secure new ones.
Analysts at Liberum increased the target price to 1330p from 1300p, adding that it seems increasingly likely that Astra will seek to keep OXB involved, particularly if global demand for the Astra vaccine remains high next year.
“There’s considerable indirect value. Through the Astra COVID vaccine OXB has been able to prove it can work across multiple vector types,” the broker noted.
“Perhaps even more importantly, OXB has proven it can do so at least as efficiently, and probably better than, other more established adenoviral suppliers. This is a huge endorsement of OXB’s capabilities and should position the company extremely well for new partnerships outside of its traditional lentiviral market.”
Shares rose 6% to 1,060p on Tuesday morning.