The Trump administration has awarded Sanofi (NYSE:SNY) and GlaxoSmithKline (NYSE:GSK) a contract for up to $1.2 billion to develop, manufacture and deliver a vaccine for COVID-19, the companies announced today.

The vaccine candidate is based on the recombinant protein-based technology used by Sanofi to produce an influenza vaccine, and GSK’s established pandemic adjuvant (immunity-boosting) technology. Manufacturing will take place in the U.S.

The award is the largest among the more than $8 billion that the federal government, under its Operation Warp Speed program, has pledged to different companies for COVID-19 vaccine development. More than half of the $2.1 billion is slated for vaccine development, including clinical trials, with the remainder used for manufacturing scale-up and delivery of an initial 100 million doses of the vaccine. Under the agreement, the federal government may order an additional 500 million doses. Sanofi said it would receive the majority of the government funding.

“The global need for a vaccine to help prevent COVID-19 is massive, and no single vaccine or company will be able to meet the global demand alone,” said Thomas Triomphe, EVP and global head of Sanofi, in a news release. “From the beginning of the pandemic, Sanofi has leveraged its deep scientific expertise and resources to help address this crisis, collaborating with the U.S. Department of Health and Human Services to unlock a rapid path toward developing a pandemic vaccine and manufacturing at large scale. With our partner GSK, we expect our Phase 1/2 study for the recombinant adjuvanted approach to start in September.”

“The portfolio of vaccines being assembled for Operation Warp Speed increases the odds that we will have at least one safe, effective vaccine as soon as the end of this year,” added HHS secretary Alex Azar. “Today’s investment supports the Sanofi and GSK adjuvanted product all the way through clinical trials and manufacturing, with the potential to bring hundreds of millions of safe and effective doses to the American people.”

Sanofi said it expects a to begin clinical trials in September, followed by a Phase 3 study by the end of 2020. If the data are positive, the companies can request FDA approval in the first half of 2021.
Sanofi and GSK are simultaneously scaling up manufacturing of the antigen and adjuvant to produce up to 1 billion doses per year globally, according to Sanofi.

Sanofi and GSK are negotiating with global organizations and with the EU Commission on supplying the vaccine to European countries from Sanofi’s and GSK’s European plants. The companies said they also plan to make “a significant portion” of total supply capacity available in 2021 and 2022 to the to an international organization of governments, global health organizations, businesses and philanthropies working to accelerate development, production and equitable access to COVID-19 tests, treatments, and vaccines.

Sanofi said it is also developing a messenger RNA vaccine candidate in partnership with Translate Bio and expects a clinical trial to start by the end of the year. If the data are positive, the earliest that regulatory approval could come would be in the second half of 2021​. Translate Bio has established mRNA manufacturing capacity and Sanofi said it expects to be able to supply annual capacity of 90 to 360 million doses.