Cangene announces continuation of biodefence programs with U.S. Government

Contracts leverage core biodefence competencies and supplement commercial product business

TSX: CNJ

Readers are referred to the cautionary notes regarding Forward-looking Information and non-IFRS Financial Measures at the end of this release. Unless noted otherwise, all dollar amounts are in U.S. dollars.

WINNIPEG, Aug. 28, 2012 /CNW/ - Cangene Corporation (Cangene) announced today the extension of an existing contract and the signing of a new contract related to United States Government biodefence programs.  The Company continues to leverage its expertise in biodefence contracting to supplement its pipeline-focused strategy in the specialty biopharmaceutical space.

Extension of AIG Contract
The Company has entered into a modification to expand the scope of work under its contract with the U.S. Department of Health and Human Services (HHS) for the development and supply of Anthrax Immune Globulin Intravenous (AIGIV).  The contract modification extends to 2016 the timeline to conduct additional activities in support of obtaining licensure for AIGIV and could generate up to approximately $16.5 million in additional revenue for Cangene over the next four years representing an increase of approximately 11% of the original contract value.  The original contract was initiated in 2005 and is scheduled to expire in 2021. This contract has been funded in whole or in part with Federal funds from the Office of the Assistant Secretary for Preparedness and Response, Biomedical Advanced Research and Development Authority.  Cangene's AIGIV, a hyperimmune antibody product specific for Bacillus anthracis bacteria, was developed to treat inhalational anthrax and was first accepted into the U.S. Strategic National Stockpile in 2007.

New VIG Supply Contract
Cangene has entered into a new contract with the Centers for Disease Control and Prevention for the supply of Vaccinia Immune Globulin Intravenous (VIGIV) into the U.S. Strategic National Stockpile, and for services to support licensure maintenance activities for the product.  The original 5-year contract for the supply of VIGIV, entered into in 2002 and extended for a further 5 years, has expired.  This new contract is expected to generate up to approximately $9.8 million in additional revenue for Cangene over an 18 month period.   VIGIV is a hyperimmune product to be used in treating and preventing certain types of severe complications that may be associated with smallpox vaccination, and is considered an important component of smallpox vaccination programs. Cangene's VIGIV product was first accepted into the U.S. Strategic National Stockpile in 2002 and was subsequently licensed in the United States by the U.S. Food and Drug Administration in 2005 and in Canada by Health Canada in 2007.

"We are very pleased to continue our work with the U.S. Government on these important programs," says John A. Sedor, President and CEO of Cangene.  "Cangene will continue to pursue opportunities to leverage our core competencies in biodefence while maintaining a focus on our commercial product business and expanding our pipeline."

About Cangene Corporation
Cangene Corporation (TSX: CNJ), headquartered in Winnipeg, Canada, is one of the nation's oldest and largest biopharmaceutical companies. It is focused on the development and commercialization of hospital and oncology clinic based therapeutics. Cangene's products are sold worldwide and include products that have been accepted into the U.S. Strategic National Stockpile. Cangene has employees in six locations across North America. It operates manufacturing facilities in Winnipeg, Manitoba and Baltimore, Maryland (through its wholly-owned subsidiary, Cangene bioPharma, Inc.) where it produces its own products and undertakes contract manufacturing for a number of customers. Cangene operates three U.S. and one Canadian plasma-collection facilities operating under the name Cangene Plasma Resources. For more information about Cangene, visit the Company's website at www.cangene.com.

Cautionary Note regarding Forward-Looking Information
This document contains forward-looking statements about the Corporation, including its business operations, strategy, and expected financial performance and condition. Forward-looking statements include statements that are predictive in nature, depend upon or refer to future events or conditions, or include words such as "expects", "anticipates", "intends", "plans", "will", "believes", "estimates", or negative versions thereof, and similar expressions. In addition, any statement that may be made concerning future financial performance (including revenues, earnings or growth rates), ongoing business strategies or prospects, future use, safety and efficacy of unapproved products or unapproved uses of products, and possible future action by the Corporation are also forward-looking statements. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Corporation, economic factors and the biopharmaceutical industry generally. They are not guarantees of future performance. Actual events and results could differ materially from those expressed or implied by forward-looking statements made by the Corporation due to, but not limited to, important factors such as sales levels; fluctuations in operating results; the Corporation's reliance on a small number of customers including government organizations; the demand for new products and the impact of competitive products, service and pricing; the availability and cost of raw materials, and in particular, the cost, availability and antibody concentration in plasma; progress and cost of clinical trials; costs and possible development delays resulting from use of legal, regulatory or legislative strategies by the Company's competitors; uncertainty related to intellectual property protection and potential costs associated with its defence as well as general economic, political and market factors in North America and internationally; interest and foreign exchange rates; business competition; technological change; changes in government action, policies or regulations; decisions by Health Canada, the United States Food and Drug Administration and other regulatory authorities regarding whether and when to approve drug applications that have been or may be filed, as well as their decisions regarding labeling and other matters that could affect the availability or commercial potential of drug candidates; unexpected judicial or regulatory proceedings; catastrophic events; the Corporation's ability to complete strategic transactions; and other factors beyond the control of management.

The reader is cautioned that the foregoing list of important factors is not exhaustive and there may be other factors listed in other filings with securities regulators, including factors set out under "Risk and Uncertainties" in the Corporation's Management Discussion and Analysis, which, along with other filings, is available for review at www.sedar.com. The reader is also cautioned to consider these and other factors carefully and not to place undue reliance on forward-looking statements. Other than as specifically required by applicable law, the Corporation has no intention to update any forward-looking statements, whether as a result of new information, future events or otherwise.

Cautionary Note Regarding Non-IFRS Financial Measures
This news release may contain non-IFRS financial measures. Terms by which non-IFRS financial measures are identified include but are not limited to "net cash", "total assets", "sales" and other similar expressions. Non-IFRS financial measures are used to provide management and investors with additional measures of performance. However, non-IFRS financial measures do not have standard meanings prescribed by IFRS and are not directly comparable to similar measures used by other companies. Please refer to the appropriate reconciliations of these non-IFRS financial measures to measures prescribed by IFRS.

SOURCE: Cangene Corporation

Francis J. St.Hilaire
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