JnJEmergentJuly 8 (Reuters) - Emergent BioSolutions (EBS.N), opens new tab said on Monday Johnson & Johnson (JNJ.N), opens new tab has agreed to pay $50 million to settle claims related to a terminated manufacturing deal for the latter's COVID-19 vaccine. Shares of the company rose about 2% in extended trading. In 2022 J&J informed Emergent of its decision to terminate the deal, citing breaches including failure to supply COVID-19 vaccine drug substance on the part of the contract manufacturer.
Emergent had said J&J breached the agreement by failing to buy the minimum quantity of COVID-19 vaccines made by the company.
Under the five-year agreement, opens new tab, signed in 2020, Emergent would provide contract manufacturing services to produce the COVID-19 vaccine drug substance for commercial manufacturing. It was valued at about $480 million for the first two years.
The U.S. health regulator had limited the use of the J&J vaccine in 2022 due to the risk of a rare blood clotting syndrome.