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UPDATE 1-Cleveland BioLabs gets DoD contract worth up to $45 mln
September 17, 2010 / 3:02 PM / 7 years ago

UPDATE 1-Cleveland BioLabs gets DoD contract worth up to $45 mln

* DoD to fund development of radiation-poisoning drug

* Contract provides options to buy $30 mln worth of drug

* Shares up as much as 18 pct

Sept 17 (Reuters) - Cleveland BioLabs Inc (CBLI.O) said it received a $45 million contract from the U.S. Department of Defense to develop and stockpile its experimental drug to treat radiation poisoning, sending its shares up 18 percent to a new 52-week high.

The company, which reported revenue of $14.3 million in 2009, said DoD will provide $14.8 million for the development of the drug, CBLB502.

Upon U.S. regulatory approval for the drug, the contract provides options for the department to buy $30 million worth of the drug.

CBLB502, aimed at reducing the risk of death following total body irradiation during or after a radiation disaster, was granted fast-track designation by the U.S. Food and Drug Administration in July.

Fast-track status is designed to expedite the review of drugs that treat serious diseases and fill unmet medical needs.

Cleveland BioLabs also has one cancer drug in a mid-stage trial and five others in pre-clinical stage.

The company’s shares, which have gained 53 percent since the news of the drug getting a fast-track status, were up 10 percent at $5.38 in morning trade Friday on Nasdaq. They touched a high of $5.75 earlier in the session. (Reporting by Esha Dey in Bangalore; Editing by Vinu Pilakkott)

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