The company has a handful of new agents in the pipeline—some in late-phase research or awaiting approval—and is exploring
additional uses for its current commercial product line. (See "Nabi's Pipeline") Revenue hit $180 million in 2004, and Nabi's
executives are constantly on the road selling the company to investors.
But that's where the similarities end. Nabi differs from its biotech peers in three valuable ways: It has no debt, it runs
a two-way contract manufacturing operation, and sales of its currently marketed products are enough to fund year-over-year
increases in R&D spending—a 10 percent increase from 2004 to 2005 alone.
And it has an exceptionally ambitious goal: to curb the threat of global antibiotic resistance. These days, it looks like
Nabi could be the first company to market a vaccine that could prevent infections of the deadly and pervasive Staphylococcus aureus (staph) bacterium.
Mark Schoenbaum, MD, a biotechnology analyst for Bear Stearns has classified Nabi as an "outperform" stock, based on his prediction
that "StaphVax will succeed in its ongoing Phase III trial." In a recent report, he writes, "If successful, StaphVax will
eventually dwarf Nabi's current base [business]." The report estimates that income from the product will start at approximately
$70 million in 2006 and grow about 3 percent every year, to more than $250 million by 2010. (Full disclosure: The author of
this article has had a small investment in Nabi Biopharmaceuticals since 2001.)
That will bring it as close to blockbuster status as any vaccine is likely to get—that is, unless Nabi gains approval to market
another product in its pipeline. NicVax, currently in late Phase II studies, is a smoking-cessation product. Critics say it's
a long shot, but it could theoretically have one of the largest patient populations in the history of biotech if the Centers
for Disease Control's estimates are right—it says about 70 percent of 47 million US smokers have tried to quit.
Sitting at a conference room table in a non-descript building a stone's throw away from FDA headquarters in Rockville, Maryland,
CEO Tom McLain is flushed with the typical enthusiasm of a small biotech company executive. He and his team have just returned
from a BIO investor conference on the West Coast and have agreed to an interview at the company's R&D facility before continuing
on to their headquarters in Boca Raton, Florida. McLain is joined by Henrik Rasmussen, MD, PhD, senior vice president of clinical,
medical, and regulatory affairs; H. Le Roux Jooste, senior vice president of global sales and marketing; Mark Smith, senior
vice president of finance, treasurer, and CFO; and Mark Soufleris, vice president of investor and public relations. They take
turns describing their vision for the company and its products.
"I came to Nabi in 1998 as the company's senior vice president of corporate services," says McLain. "I was the CFO and headed
up HR, IT, and legal as well. Finances were tough. Nabi had some very large debt obligations and cash flow from the business
was not meeting them. So the 1998 to 2001 period was spent refocusing the business model.
"It was out of that refocusing that one of our fundamental principles was put in place—that our efforts in research and clinical
trials to develop new products were to be funded from cash flow from operations. It is a commonsense business model not ordinarily
followed in biotech, but by 2000 the biopharmaceutical products business was self-sustaining."