IRBM COVID (IDFF)

IRBM provides a synergistic multifaceted response to tackle coronaviruses. The supports the development of increased GMP manufacturing, testing and release capacity for the manufacture of COVID-19 vaccines.

The proposed transaction will support the company to set up and implement vaccine manufacturing facilities to respond to the current sizeable demand for COVID-19 vaccines and also leverage rapid access for future epidemic threats. This provides a European solution to partially alleviate the substantial shortage in global vaccine manufacturing capabilities. In addition, the project will develop next generation novel therapeutic solutions for both existing and potential coronaviruses.

The financing of this project addresses the failure in financial markets for RDI - in this specific case in biopharmaceuticals. The failure arises in part from limited access to and/or higher cost of financing due to information asymmetries associated with the inherent uncertainty of RDI activities, and resulting in high screening and monitoring costs. Other factors are the misalignment of incentives, lack of collateral and/or lack of track record.

Through support from the Infectious Diseases Finance Facility (IDFF), the operation addresses the need of a financially underserved company operating in the sector of the development of coronavirus vaccines and therapeutics, as well as boosting the European manufacturing volumes and capacities of viral-vectored vaccines. The contribution to EU policy is therefore significant.

The EIB's contribution is notable on both the financial and non-financial side. The funding provided under IDFF will substantially enhance the financial resources available to the borrower to execute its development plan and may crowd in further investors. Structuring the financing as a venture debt operation (equity risk) is appropriate given the borrower's stage of development and takes its cash flow profile into account. Therefore, the EIB also provides an added value in terms of financial structuring expertise, in addition to the technical contribution and advice.

The project mainly concerns investments in research, development and innovation (RDI) that are expected to be carried out in the Promoter's existing facilities or other research centres already authorised for the same purpose and would therefore not require an environmental impact assessment (EIA) under the Directive 2014/52/EU amending the EIA Directive 2011/92/EU. Investments are also expected to be made into the furnishing and validation of existing manufacturing and laboratory facilities, this aspect of the project falls under the annex II of the Environmental Impact Assessment (EIA) directive (2014/52/EU), referring to the manufacture of pharmaceutical products. Full environmental details will be verified during appraisal, including evidence of any screening by the competent authorities.

The Promoter is a private company, not operating in the utilities sector and does not have the status of a contracting authority; thus the project is not covered by the EU directives on procurement. However, the Promoter's procurement procedures are expected to be in line with EIB guidelines for private sector projects. The Bank's services will verify details during the project due diligence.