CLOVER BIO-B (02197) has announced that its wholly-owned subsidiary, Clover Biopharmaceuticals (Hong Kong) Ltd. ("Clover Hong Kong"), and Gavi, the Vaccine Alliance, have entered into a settlement agreement dated March 22, 2026. This agreement fully and finally resolves the arbitration initiated by Gavi concerning the termination of a pre-purchase agreement and a demand for the return of a $224 million pre-payment. Following the payment of an initial sum detailed below, all claims made by Gavi against Clover Hong Kong in the arbitration will be withdrawn and discharged.
The decision for Clover Hong Kong to enter into the settlement was made solely for commercial reasons. The company believes that, considering the Group's current focus on its core strategic priorities, the settlement represents a prudent commercial solution that aligns with the interests of the company and its shareholders. It is anticipated that the agreement will provide greater predictability for the Group's future development and its potential ability to achieve its core strategic goals. The settlement does not constitute, and shall not be interpreted as, an admission of any liability by either Clover Hong Kong or Gavi regarding the claims raised in the arbitration.
Under the terms of the settlement agreement, Clover Hong Kong has agreed to pay Gavi the following: a one-time upfront cash payment of $7 million; deferred cash payments, made semi-annually, of $1.5 million or a low single-digit percentage of the Group's cash balance, whichever is higher; and contingent payments linked to the Group's future cash receipts, calculated as a mid-to-high single-digit percentage of such receipts, which may include funds from financing, business development, and product sales. The total cumulative amount of future payments, comprising both deferred and contingent payments, is capped at a mid-tens of millions of US dollars. If payments are made ahead of schedule within the 12-year term specified in the agreement, applicable discounts may be available.
The Group will continue to advance the development of its self-developed respiratory syncytial virus combination vaccine candidates, SCB-1022 (RSV + hMPV) and SCB-1033 (RSV + hMPV + PIV3), focusing on its core strategic priorities and objectives. The aim is to maximize their value by achieving more comprehensive and broader-spectrum protection to address significant unmet medical needs globally.
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