8-K: Dynavax Technologies Enters New Supply Agreement and Appoints New Principal Accounting Officer

Dynavax Technologies Corporation has entered into a new supply agreement with West Pharmaceutical Services for syringe stoppers and appointed Kelly MacDonald as the principal accounting officer.

Summary

• Dynavax Technologies Corporation entered into a new supply agreement with West Pharmaceutical Services, Inc. on February 10, 2025, for the manufacture and supply of syringe stoppers for the HEPLISAV-B vaccine.
• The new agreement replaces the prior supply agreement dated July 27, 2016.
• Dynavax is obligated to purchase certain volumes of the product from West, with pricing based on the volume purchased in a calendar year and subject to change based on a specified price index.
• The term of the supply agreement is four years from the effective date, subject to certain extensions.
• The agreement can be terminated by either party for uncured material breach or insolvency.
• On February 13, 2025, Kelly MacDonald, the Chief Financial Officer, was appointed as the principal accounting officer of the company, effective immediately.

Sentiment

Score: 7

Explanation: The announcement is generally positive as it secures the supply chain for HEPLISAV-B and ensures financial leadership continuity. There are some risks associated with purchase obligations and pricing adjustments, but overall, the news is favorable.

Positives

• The new supply agreement with West Pharmaceutical Services ensures a continued supply of syringe stoppers for the HEPLISAV-B vaccine.
• The agreement allows for pricing adjustments based on volume and a specified price index, which could provide cost management flexibility.
• The appointment of Kelly MacDonald as principal accounting officer provides continuity and leverages her existing financial expertise.

Risks

• Dynavax is obligated to purchase certain volumes of the product, which could pose a financial risk if demand for HEPLISAV-B declines.
• Pricing is subject to change based on a specified price index, which could lead to increased costs.
• The agreement can be terminated for uncured material breach or insolvency, which could disrupt the supply chain.

Future Outlook

The supply agreement ensures a stable supply of syringe stoppers for the next four years, subject to potential extensions and termination clauses.

Management Comments

• Ryan Spencer, Chief Executive Officer, signed the report on behalf of Dynavax Technologies Corporation.

Industry Context

The supply agreement is crucial for Dynavax to maintain the production and distribution of its HEPLISAV-B vaccine, which competes in the hepatitis B vaccine market.

Comparison to Industry Standards

• Supply agreements are standard practice in the pharmaceutical industry to ensure a reliable supply of critical components.
• Companies like Pfizer and Moderna also rely on similar agreements with suppliers for their vaccine production.
• The four-year term is typical for such agreements, providing a balance between stability and flexibility.

Management Changes

Stakeholder Impact

• Shareholders: The supply agreement provides assurance of continued vaccine production, which is positive for revenue generation.
• Employees: The agreement supports continued operations and employment related to HEPLISAV-B production.
• Customers: The agreement ensures a stable supply of the HEPLISAV-B vaccine.
• Suppliers: West Pharmaceutical Services benefits from the supply agreement with Dynavax.

Next Steps

• Dynavax will file the full text of the Supply Agreement with the Securities and Exchange Commission as an exhibit to the Company's Annual Report on Form 10-K for the year ended December 31, 2024.

Key Dates