Firm’s stock nudged up 67%, and testing in renal-failure patients will be initiated.

FDA has removed a 15-month clinical hold on Dynavax Technologies’ HBV vaccine, Heplisav™. The firm is still not allowed to test the candidate in healthy volunteers but has been given the go-ahead for a Phase III trial in individuals with chronic kidney disease.

The news propelled Dynavax’ stock almost 67% to open trading today at $2.92. In the past year and a half or so, the firm’s value had depreciated over 103% and reached an all time low of $0.16 in November 2008.

The placement of the clinical hold in March of last year sent the company’s share price down 64% in the first week of trading; it went from $5.95 on March 14 to $2.12 by March 20. Then in October 2008 the FDA confirmed that Heplisav was not safe to be tested in healthy people, keeping the company’s share price below $0.50 for the next couple of months.

The agency noted in October the possibility of evaluating the vaccine in those with renal failure, but that was not enough to keep partner, Merck & Co., in tow. By December 2008, Merck had pulled out of the collaboration, sending Dynavax’ stock spiraling downward again by 28% in the first day of trading. Dynavax could have earned $105 million in milestones under the arrangement with Merck over and above the $31.5 million up-front fee.

Now Dynavax says that it will initiate a Phase III study in chronic kidney disease patients in the near-term. The aim is to test Heplisav for its ability to provide increased, rapid protection with fewer doses than current vaccines. Heplisav combines hepatitis B surface antigen with a toll-like receptor 9 agonist to enhance the immune response.

The company is also planning another Phase III lot-to-lot consistency trial in adults over 40 years in early 2010. It says that its global strategy, which is based on discussions with FDA and EMEA, is to develop the HBV vaccine for populations that less responsive to current vaccines, including those over 40 years and others.

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