Good day, and thank you for standing by. Welcome to the third quarterly report, Q3, for the nine-month period ended the 30th of September 2023 conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star one and one on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star one and one again. Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Rolf Sørensen. Please go ahead.
Yeah. Thank you, operator, and welcome, everyone. Good morning to some of you, good afternoon to the rest of you, and welcome to Bavarian Nordic's Q3 presentation. My name is Rolf Sørensen, VP, Investor Relations, and with me, I have President and CEO, Paul Chaplin, and Executive Vice President, CFO, Henrik Juuel. Yet again, we've had a quarter of strong operational performance, and to talk to you about that, we'll go through slides, and after that, Q&A. Before I hand over the presentation, I just briefly will walk through the disclaimer. This presentation includes forward-looking statements that involve risks, uncertainties, and other factors, many of which are outside our control, that could cause actual results to differ from results discussed.
Forward-looking statements include our short-term objectives and opportunities, financial expectations for the full year, as well as statements concerning our plans, objectives, goals, future events, performance, and other information that is not historical information. We undertake no obligation to publicly update forward-looking statements to reflect subsequent events or circumstances after the date made, except as required by law. With this, I will hand the presentation over to you, Paul.
Thanks, Rolf, and welcome everyone to today's company announcement. If you turn to slide five, today we've announced once again record numbers for the first nine months of the year. DKK 4.6 billion in revenue, which represents almost 150% increase to this time last year. Very strong performance on the EBITDA at DKK 1.6 billion, which represents a 34% EBITDA margin. What's really pleasing is obviously that all parts of the business are performing extremely well and contributing to these record numbers. On Travel Health, we've seen a strong rebound, not only in the travel business, but we've also seen strong brand performance and portfolio expansion with the new acquisition.
I will leave it up to Henrik to talk a little bit more about the numbers in detail, but, you know, here we are in mid-November, and we are very firmly standing by our annual guidance, and I'll leave it up to Henrik to explain the moving parts. But as I said, we're very confident that we'll meet our annual guidance of DKK 6.9 billion in revenue and DKK 2.3 billion in EBITDA, recording a record financial year for the company. If you go to the next slide, slide six. Our commercial portfolio, which is really going from strength to strength, is split in two parts: Travel Health, where we really do represent the largest company supplying travel vaccines around the world, and our Public Preparedness part of the business, which is supplying our mpox, smallpox business around the globe.
If you go to the next slide. We've seen some recent development in our Public Preparedness part of the business, in that we're now seeing since the outbreak of mpox, which was unprecedented last year, we're now seeing some national recommendations, which is opening up a private market opportunity for us to distribute JYNNEOS or IMVANEX, improving the access of our vaccine to people who are at risk. So recently, ACIP, which is the national body in the U.S., recommended JYNNEOS for the risk population, and this is estimated to be around 2 million individuals, the vast majority of which have not been vaccinated. We plan to launch JYNNEOS next year and improve the access to this, this risk population and hopefully improve people's lives. This, however, is only one recent recommendation.
We've seen similar recommendations both in Germany and more recently, the U.K., and the European AIDS Clinical Society also made a recommendation that everyone with HIV or people on PrEP treatment for HIV should also be offered JYNNEOS. And as I said, this really represents an opportunity, a new emerging market, and I think it represents a couple of things. One, mpox is here to stay. There is that recognition with these recommendations. Secondly, to prevent or reduce future outbreaks, it's clear that vaccinating risk populations will be key. And thirdly, there is a recognition that JYNNEOS is a highly effective vaccine preventing mpox infections and hospitalizations, which is supported by the real-world efficacy data that's been published by many groups since the outbreak last year. To go to the next slide.
So traditionally, our public preparedness business has really been supplying our vaccine as a stockpile vaccine to prevent to help prepare governments should smallpox be released. And we have had two long-term successful contracts, both with the U.S. government and Canada, and that still is true today. In the U.S., we have an order to convert bulk that has previously been ordered over many years into approximately 13 million freeze-dried doses, and this order is almost $300 million. We're currently completing the validation of that manufacturing process this year, and the first part of that order, which was awarded last year, $119 million U.S. dollars, we will start revenue recognizing next year as we start manufacturing of that order.
Now, the bulk that I talked about that will be used to convert and produce those 13 million doses was already ordered and revenue recognized, but unfortunately, some of that bulk was used in response to the mpox outbreak last year, and that needs to be replaced. That has started to be replaced with a recent order for $120 million, which is part of the revenues that we'll be seeing this year, but that only goes some way to replace the bulk. So in addition to the $299 million, which we expect to be seeing over the next couple of years, there is additional bulk orders coming from the U.S.
In Canada, we have also a very large order book here, with up to $290 million to be delivered this year and up to 25, and then future options of $180 million up to 2031. So very long-term commitments. Since mpox, what we've now seen is an expansion of our customers and the contracts that we have. We have now a framework agreement with HERA, which is part of the EU, for up to 2 million doses. We have already secured orders under another EU funding mechanism, the rescEU, for 21 million next year, and we are in detailed discussions with a number of governments, which are looking to place larger orders to improve their stockpiling for smallpox.
We expect the future smallpox business to grow in addition to the new emerging private market for mpox. We go to the next slide, slide nine. Talk a little bit about travel health. Our travel health franchise began in 2020, when we purchased the rabies and TBE vaccine. At that time, we really believed our strategy would be that we could do more with those assets, with a key focus that we would be able to give them than the previous owners. The record numbers that we've been recording this year and last year is testimony to that strategy, that we have sold more rabies doses than anyone else has done before. Again, we've seen strong sales also of Encepur, really endorsing that strategy that we picked up.
Part of that strategy was also to undertake a very complicated tech transfer for both rabies and TBE from GSK to Bavarian Nordic over the course of five years, so that by 2025, we would have the full manufacturing in-house. I'm very pleased to announce that that is going very, very successfully. Packaging is the first part that we took over. Then we're looking at taking over the filling. We have completed the tech transfer of the rabies filling in our state-of-the-art facility in Denmark, and that we hope to get regulatory approval next year. The facility has been adapted at the end for the bulk production, and we're currently completing the tech transfer, the bulk production for both of those vaccines. We remain fully on track to have the tech transfer completed by 2025.
In addition, we've added to the portfolio with the recent acquisitions from Emergent earlier this year, and here everything is going according to plan. The integration is going according to plan in terms of the employees and the facilities that we took over, both in the U.S. and in Switzerland, and the market transfers remain on track to be completed by year end. We believe with Vaxchora and Vivotif, that we can really do the same thing as we did with rabies and TBE, and really grow those assets to a combined future annual revenue of $100 million in the coming years. If you go to the next slide, slide 10. In addition to Vaxchora, the recent acquisition also came with a late-stage program for a vaccine against chikungunya.
Chikungunya is a mosquito-borne viral infection that can cause severe high fever and severe joint pain in up to 85% of people who get infected. And this can remain prolonged, protracted for a number of months or even years in just over 40% of the people that become infected. And almost three-quarters of the world's population are living in areas where chikungunya outbreaks occur. Go to the next slide, slide 11. So the vaccine candidate that we acquired was a virus-like particle vaccine against chikungunya, and two phase IIIs have read out successfully during the course of this year. And both those phase III studies have shown that this vaccine candidate is highly immunogenic. It's the only chikungunya vaccine candidate that has demonstrated a fast onset of protection in phase III.
So we already see within the first week, almost 50% of the people vaccinated, generating antibodies that are believed to be protective. By the second week, that's almost 100%, 90%-100% of the population vaccinated, and that peaks at day 22 with 98%. We see a similar profile in older adults, 65 or older, and this really represents a very fast-acting chikungunya vaccine, which we think has a very, very competitive profile that we will file next year and hopefully be able to launch in 2025. If we go to slide 12, this market has been estimated, the travel market alone has been estimated to be valued between $400 million-$600 million annually.
To explain that number a little bit, you have to understand the epidemiology. So as I said, three-quarters of the population live in areas where there are outbreaks, but there are certain countries where the outbreaks are more frequent, and in many of those countries, it's considered more endemic. There are then medium-risk countries and lower-risk countries. And when you're looking at travel, you're really only considering the high-risk countries where there is a higher risk of being exposed to chikungunya. So if you go to slide 13, as I said, the market size has been estimated by others to be between $400 million-$600 million annually, and this is on the basis of quite a number of conservative assumptions.
One is that 50 million people are traveling to these high-risk countries, and it's our experience and the experience of other travel vaccines, that of those that number of people, roughly about 8% of those people will get a vaccine, which gets you to that roughly 4 million doses. Which is driving that figure of $400 million-$600 million in valuation for travel alone. The endemic market, which the vaccine is also being developed for, obviously, is a much larger market, where much more doses, between 20 million-40 million doses annually, will be required. There, we're already in discussions with potential partners who will not only help manufacture, but also distribute and sell the vaccine in areas where it's endemic. And with that, I will hand over the presentation to Henrik Juuel.
Yeah, thank you very much, Paul. So, I will start in the usual way and take you through the, quarter, quarterly performance on sales and, nine months year to date. So if we look at slide number 15, you will see we delivered close to DKK 1.4 billion in, in revenue for the third quarter, which is a significant increase of 37% compared to the same quarter last year. Again, here we have divided our business into these two pockets. We are talking about the travel, where we have our travel vaccines and the public preparedness business with our mpox and smallpox business.
If you look at the travel health business first, you will see we delivered a 55% growth, mainly coming from our rabies business, but also our Encepur business and of course, the expansion of our portfolio with Vivotif and Vaxchora. So 55% growth from the travel health business. On the public preparedness side, 23% growth for the three months, and altogether, this takes us to DKK 4.6 billion in total revenue for the first nine months. DKK 1.6 billion of that from our travel business, approximately DKK 2.9 billion from our public preparedness business.
Record numbers, as Paul said in the beginning, we have still confirmed our guidance of DKK 6.9 billion for this year, which you can see tells you that we will have a busy fourth quarter ahead of us, as we need to deliver DKK 2.3 billion in revenue for the fourth quarter of this year to reach our guidance. That's all on track, and we are very confident that we will deliver that. I will come back to more details about the guidance on a later slide. Before we go to the full P&L, let's have a look at what some of the growth drivers from for this nice growth that we have seen in the first nine months of the year.
If you look at the quarters in isolation here, and on the rabies side, we are seeing a significant growth compared to last year in terms of the market size. In the U.S., 23% up from from the same quarter last year, and actually 63% up compared to the third quarter in 2019, which is sort of our benchmark, pre-COVID benchmark. So we are right now in the U.S., looking at a rabies market that is actually significantly larger than it was pre-COVID. In Germany, as our proxy for how the European business is doing, we saw a significant negative impact during the COVID pandemic, as it is a pure travelers vaccine in Europe. So therefore, we're also seeing decreases compared to last year, 65%.
But we're also seeing the same trend here, maybe not to the same magnitude, but still that the market size of the TBE market in Germany now is actually larger than it was pre-COVID, 6% larger. If we then turn to our own sales, which is, of course, impacted significantly by the market that is growing and fueled by more travelers, we see our rabies sales going up by 28% compared to the third quarter of last year. And that is market growth, but also by our strong brand performance in these markets. We have today approximately 70% of the U.S. market, which is a higher market share than before we took over the vaccine from GSK. And in Germany, we have 94% market share. So clear market leader in two very important markets.
On the next slide, we're looking at the TBE market in Germany, where we see here a growth compared to last year of 33%, and again, also significant growth compared to the pre-COVID situation, 26%. And some of this we see here is basically higher awareness in Germany. We also, if we look beyond Germany, we have also seen an endemic expansion in Europe. Basically, that this disease is spreading to more countries, and the whole endemic area will drive future growth for us. Our own sales went up by 44% compared to last year, driven by nice market growth. We are holding on to 27% of the market in Germany.
Still, somewhat impacted by a very brief, out-of-stock situation we faced in the last autumn, but, recovering, gradually back to our, pre-stock out market share. On the next slide, let's talk about the, the profit and loss, for a moment here. Third quarter, revenue DKK 1.4 billion, as we just talked about, delivering a gross profit of DKK 862 million, which corresponds to a gross margin of 63%. Total operating costs, approaching DKK 1.2 billion for the third quarter, and obviously, significantly impacted by the write-down of our COVID-19 project. You see here that the R&D cost is adding up to DKK 980 million here, and that includes DKK 558 million write-down on, on our COVID, projects.
That takes us to a negative EBIT for the quarter of DKK 326 million, but on a nine-month basis, still significantly positive by close to DKK 600 million . EBITDA for the DKK 80 million and not impacted by the write-down of our COVID-19 assets. On a nine-month basis, DKK 4.6 billion in revenue, and an EBITDA of more than DKK 1.5 billion , corresponding to an EBITDA margin of 34%. So just a quick word on the COVID-19 write-down before we move to the next slide. When we announced the final result of the COVID projects, we also announced that we did not see a future commercial opportunity with these assets here.
What has happened during the third quarter here is a simple accounting consequence of that statement earlier. As long as we can't see future revenue streams from this asset here, we can't have it on our balance sheet, and we have basically written it down. The write-down includes total cost of approximately DKK 1.4 billion. That is what the total project has cost. We have received support from the Danish Minister of Health, adding up to DKK 800 million, and the rest has been funded by Bavarian Nordic. That precise number is the DKK 558 million that Bavarian Nordic has invested in this project.
Right now, this project, we have an ongoing dialogue with the Danish Minister of Health, the European Medicines Agency, and our partner at AdaptVac, on how best to leverage all the learnings we had from this project going forward, I mean, a potential similar pandemic situation in the future. Don't forget that we actually delivered on the phase III primary endpoint and actually managed to prove that the COVID-19 vaccine was as effective as Comirnaty from Pfizer against Wuhan and the closely related variants. It further shows a good tolerability through a safety study. So there are a lot of learnings that have been captured, and we are currently, as I said, having a dialogue with our partners on how best to leverage this going forward. Next slide, which is our cash flow and balance sheet.
A positive net cash flow for the period of DKK 455 million, obviously driven by positive cash flow from operating activities, more than DKK 500 million positive, despite continued build-up of inventories according to plan. Our cash flow from investment activities impacted by the acquisition, where we, during the quarter, we paid $274 million to Emergent BioSolutions as the upfront payment for the acquisition. And then we have cash flow from financing activities that are impacted by the capital increase we did. It's impacted by, the last milestone funding we got for the COVID project, and finally, we paid back some repo positions we had. But a nice net cash flow positive for the period of DKK 45 million. To the right, I would just highlight that our current cash position is, is strong.
We have improved the cash position over the quarter, and we now have approximately DKK 1.5 billion in securities and cash and cash equivalents. So a good, strong capital. I would also here like to announce that we have very recently signed a revolving credit facility with our two bank partners, Danske Bank and Nordea. It is a revolving credit facility that gives us access to DKK 1 billion, which we can draw upon if and when we need it, pay it back when we don't need it. So it gives us a lot of additional financial flexibility. For instance, to absorb fluctuations in working capital, also handle periodic significant milestone payments to GSK or Emergent over the next two years.
So a very nice addition to our DKK 1.5 billion in cash, that gives us a lot of financial flexibility. Short-term, we have no need for this, but it gives us, as said, a very good flexibility. And it is a strong recognition that Bavarian Nordic is actually now a real bankable business. Our outlook, as you will have read in our quarterly report, we are maintaining, which was increased in August, based on additional orders from BARDA, but also other smaller mpox orders. And that was also the first time that we included the impact from the acquisition. So it now stands at DKK 6.9 billion in expected revenue and an EBITDA of DKK 2.23 billion.
We maintain it, but it's very important to say that this guidance here now assumes that some of the previously announced smallpox and mpox orders will most likely slip into the first half of January. They were originally scheduled for December, but due to the currently expected delivery schedule, some of these might slip into January. And that has been taken into consideration when we say we maintain the guidance, and we have been able to do that due to the continued very strong performance that we see from our travel health business. We are getting close to the end of the presentation, but I would just like to highlight on this slide here. This is our positioning slide. We still have this bold ambition to become one of the largest pure-play vaccine companies. We are already now leading company within different segments.
We are the world's largest travel vaccines company. We do operate in very attractive underlying segments with growth. We have a strong EBITDA, and we even have good margin expansions. Best examples is from our tech transfer project, where we anticipate to improve the gross margins for our Encepur and our Rabipur rabies vaccines by around 10 percentage points. It's a profitable business. We have a strong cash flow generation from the business at the moment. We have a financial position that enable us over the next couple of years to pay back the money that we still owe to GSK and to Emergent BioSolutions. Finally, before I hand the word back to the operator, I'm pleased to announce save the dates for our capital markets day that we will conduct in late February next year.
So the plan is that we start in Copenhagen, Monday, the twenty-sixth of February. We'll be in London the day after and in New York on the Wednesday. And here, at this Capital Markets Day, our chairman and management will have the opportunity to present and discuss the company's vision and strategy in much greater detail. So with that, I hope many of you analysts and key investors will save these dates in your calendars. So please, operator, it's time to open up for questions.
Thank you. As a reminder, to ask a question, you will need to press star one and one on your telephone and wait for your name to be announced. To withdraw your question, please press star one and one again. We will take our first question. Your first question comes from the line of Peter Verdult from Citigroup. Please go ahead. Your line is open.
Thank you, Pete here from Citi.
... Two questions maybe for Paul, both for Paul. Just on the mpox private market, private mpox vaccine market development efforts that you're gonna undertake. I mean, how aggressive and quick and quick acting is Bavarian going to be? I suppose what I'm trying to get to is, do you see meaningful revenues from that private market coming as early as next year, or is this - do we have to be a little bit more patient and is it a longer-term process? I just wonder what you're doing following the ACIP meeting, you know, to accelerate efforts to develop this private market in the U.S., and anything you're willing to say about pricing or potential pricing in this market would be helpful.
Then secondly, maybe for Paul or Henrik, you're gonna be spending DKK 2 billion on R&D this year. We have that dropping to DKK 1 billion next year and then lower thereafter. Is that the right way, think, of thinking about it, or will the step down in R&D be more profound than what we're currently expecting? Thank you.
Yeah. Thanks, Peter. So on the mpox private market in the U.S., you know, I think that there is a sense of urgency, not only by the authorities in the U.S., but also by us, that we need to act quickly. So typically, when there's a recommendation by ACIP, it can take quite some time before that recommendation is published. The CDC has actually committed to publishing as early as January next year. And one of the reasons for that is that everyone, including ourselves, would like to improve the access to JYNNEOS before the summer when a lot of the pride events are occurring, so that we can protect as many people as possible.
So that's the timeframe that we're gearing up to, which is to launch as early as we can next year, hopefully in time to improve access and get people vaccinated for the summer events. The pricing that we indicated to ACIP was up to $270 per dose. So that's a typical price, I would say, for commercial vaccines in this space. And in terms of guidance, obviously, we're not guiding for next year, and there's many factors that will affect the number of doses that we will sell. But as it's an emerging market, we will, we will have to see how it goes. But as I said, we're taking it extremely seriously and are gearing up as fast as possible for that launch.
Maybe I'll take a stab at the R&D, and then, Henrik, if you wanna, if you wanna add anything, that's fine. In terms of R&D, again, we're not guiding for next year yet, but I think you need to remember that while we've peaked at quite high levels over the last couple of years in terms of R&D, there is a big proportion of R&D that will still be required for Chikungunya. So although the phase IIIs have read out and are being completed, there are new studies that we have already started, such as a booster study, which is a follow on from the phase III, and there will be post-market commitments, most likely, we will have to conduct.
So that will have an impact on the R&D level, but we do expect an R&D level to drop compared to what we've been seeing over the last couple of years. Henrik?
Yeah, no, Paul, I think you did very well. I think it is, we will have, of course, the Chikungunya development, and we should definitely see a drop. But within the next couple of years, we still have some significant investments to be done, Chikungunya side. So that's what we can say now.
Thank you. We will take our next question. Your next question comes from the line of Boris Peaker from TD Cowen. Please go ahead. Your line is open.
Great, thanks. I have two questions, one on mpox and the other one on the chikungunya side. On the mpox side, you have a freeze-dried formulation that should get approved, or at least we anticipate this year. How do you think that approval in freeze-dried will impact your discussion for any kind of stockpiling, procurement, or, you know, with any country, U.S. or outside the U.S.? And in terms of chikungunya vaccine, obviously, the biggest news in this space is Valneva recently announced approval of their vaccine. Just curious what we could learn from their approval, their post-marketing commitment, and what that implies in terms of what you anticipate for your vaccine.
Yeah. Hi, thanks, Boris. So on freeze-dried, yes, we're working, we're working with the FDA on a freeze-dried formulation. As I said, we're just completing the manufacturing validation in our facility, and then we'll start up manufacturing the order next year. We plan to file the supplemental BLA next year, meaning that we will probably get an approval sometime in 25. Right now, we're only really focusing on an FDA approval for freeze-dried. And currently we already have an order, and more orders could come without the approval being necessary. So I think in terms of future BARDA orders, the FDA approval has little impact. Now we're still in discussions with other governments, and freeze-dried is coming up as a potential option, and we'll have to see whether we expand that approval to other territories, such as Europe and Canada.
But again, that's more dependent on the ongoing discussions that we're having. So on chikungunya, yes, the first chikungunya vaccine has been approved by the FDA. I think there was nothing really surprising for us in what's come out of either the post-market commitments or in the data that is around it. I would say, what it has done is really endorsed our belief that we have a very, very competitive target product profile, because one of the things that you'll see if you read the approved label, is that there's a whole section on chikungunya-like adverse reactions, which they've seen up to 12% of people vaccinated, and roughly 2% have severe chikungunya adverse-like reactions.
We don't see similar reactions, and nor do we expect to, because that is a viral-like particle, and I think that's a really compelling advantage that we may have, when we come to our approval and our launch, in time.
Great. Thanks for taking my questions.
Thank you. We will take our next question. Your next question comes from the line of Michael Novod from Nordea. Please go ahead. Your line is open.
Thank you very much, Michael Novod from Nordea. Couple of questions. First, back to one of the previous questions around the potential in the private market. Obviously, when you follow Bavarian sort of LinkedIn profile, you sort of seem to be on a hiring spree in the U.S. for PBM people, medical liaison, salespeople, et cetera. Is that only to support Jynneos in the private market, or do you also see sort of other ways where you can, for example, optimize further on your sales efforts and commercial efforts in the rabies space? Secondly, can you remind us, when you look at the Canadian order and timings, it's from 2023 to 2025, the initial order. How much is sort of split between 2024 and 2025?
Yeah, let's start with those two questions, and I'll get back.
Thanks, Michael. So, I would say that, you know, our expansion and launch preparation for the private mpox is moving us into new territories in the US, and that it, it's really a fully reimbursed product, so into managed market where we need to expand our expertise. So that's primarily where you will probably be seeing a lot of the expansion and recruitment activities. In terms of rabies, we're also obviously expanding because we obviously have Vivotif and Vaxchora coming on board as well, so we have a bigger basket of assets on that one. Your second question related to the split on the Canadian order, and I must admit, off the top of my head, I don't have that. I don't... Henrik, do you?
No, we haven't actually disclosed the split between 2024 and 2025 yet, so that'll have to come together with our guidance later.
Right. Okay, that's fine. I'll jump back in the queue. Thanks a lot.
Thank you. We will take our next question. Your next question comes from the line of Thomas Bowers from Danske Bank. Please go ahead. Your line is open.
Yes, thank you very much. A couple of questions here from us as well. So, maybe just digging a little bit to mpox and, I'm not sure what you call it, the directional 2024 guidance. So, first of all, are you still in advanced talks regarding additional longer term orders? And, how should we think about China still? And well, or maybe asking in a different way, how comfortable are you actually with the current consensus, which is around DKK 3 billion for 2024? And then the second question, just on Rabipur. So, originally, you guided for mid-single digits growth potential, that was pre-COVID.
And now here, still, well, some years now, post-COVID, it seems like you still are seeing extremely strong growth. So, is this still, you would say, traveling lagging behind, or are we actually starting to see some structural changes here with the maybe also vaccine awareness post-COVID here? So, is there anything in the underlying market growth that should make us maybe think differently about the continued growth over the next couple of years and maybe also the peak market potential here? And then just a final question, just on capital allocation. So, with the current balance sheets, is that something that you... Well, could you maybe even start to consider share buybacks at some point in time? Thank you.
Thanks, Thomas. Henrik, do you wanna take a stab at those?
Yes, I can definitely do that. So I think let's start with the mpox question we had first, how are our talks going with the various governments? We do have several dialogues ongoing with the governments on potential smallpox orders. The ones we have disclosed, that's France, who have been out openly with putting their strategy forward to replace the current stockpile. And then, of course, there's China. And how likely is it that these will occur? I think we have continuous dialogue with both governments. It's a good question, how likely are they? I think we are quite confident that some of it will turn into business. But we are dealing here with politicians. We are budgets, et cetera, so it is things that can take time.
But we hope that, during next year, we will be able to sort of get something out of these dialogues, whether it being France, China, or some of the other dialogues that we have. Do we feel comfortable with the consensus for 2022? Obviously, I cannot comment on that one yet. But we will come out with our guidance for 2024 in due time. Then there was a question to Rabipur. You're right that when we acquired the product, we actually saw the Rabies business as a pretty mature business that would just tickle along with low single-digit growth. We have been very positively surprised. I think first of all, it was in particular the U.S. part of it that was pretty resilient during the COVID time due to the post-exposure segment of that business.
With travel rebounding back, we have just seen these market growth tremendously. We do believe that that is driven by maybe a little, you can say, backlog from the COVID days. That drives a little of it, but to our understanding, it is to a large extent driven by a higher awareness and more people traveling these days. And of course, we like to take some credit for that. We are the market leader, both in the U.S. and in Europe, and driving the market as a leader that helps supporting the constant awareness of not being vaccinated. For how long can this continue? I don't think it will continue forever.
Of course, this kind of growth, the market will be saturated at some point, and then I think we will return to some of the growth levels we anticipated when we acquired the product, but it will be at a different base level at that time. Then, when it comes to our capital allocation, I think right now we are, we are a growth business. We want to grow our top line, and we have DKK 1.5 million available today. Don't forget, over the next two years, we need to pay back to GSK, to Emergent, probably to AdaptVac , if the milestones are triggered on, on the COVID project. And that means we need to make sure we can pay these payments.
In all our forecasts, we can, but our focus during these two years will be to pay back what we owe to these partners. And then, of course, one day, when we have more money that we feel we need to invest in the business, we will be looking at, obviously, how to make sure the money flows back to the shareholders, either in the share buybacks, the dividends, or what have you. But for the moment, we have felt that it's a little too early to do that, given the payments we have in front of us. So I hope that answered your question, Thomas.
That, that's very helpful. Thank you very much.
Thank you. Once again, if you wish to ask a question, you will need to press star one and one on your telephone. We will take our next question, and your next question comes from the line of Jesper Ilsø from Carnegie. Please go ahead. Your line is open.
Thank you so much. I just have a couple of questions on the cash flow profile in Bavarian Nordic in the coming years. I know you're not, of course, guiding for 2024 yet, but just some high-level perspectives. When we, for example, model the GSK milestones next year, is it fair to use the deferred consideration for product rights in your nine-month reports? And can you also perhaps remind us about the potential milestones on the COVID program? And then lastly, just net working capital, just how we should think about that going forward. Thank you so much.
Okay. Thanks, Jesper. I think that's for me. I think on the deferred considerations, I think next year will be one of the years where we will pay some significant milestones to GSK. That's all in the plan, but that will happen during next year. So I think altogether, we have approximately DKK 2.7 billion ahead of us. GSK, the milestones all link to the Tech transfer of manufacturing, which progress really well, and we'll hit some important milestones next year. Then we have approximately DKK 500 million linked to the acquisition we did from Emergent, and here it's all linked to successful development of the Chikungunya vaccine.
And finally, we have also in the numbers here reserved an amount for potential milestones to AdaptVac once the final study report has been completed on the trial here, amounting to DKK 75 million, approximately. Looking at the moment, we are building up inventories as we're taking over manufacturing. So that is something that will continue into next year, and until we sort of end the tech transfer from GSK. We are basically now building up, starting to build our own manufactured products, and until we are ready to supply the market with these, we still have to buy from GSK. So we have sort of dual supply chains in play during this period of time.
But after 2024, we will finally start selling the product we have manufactured ourselves at a better margin. So we should see some continued inventory build up during next year.
Thank you so much.
I hope that answered your questions, Jesper.
It did.
Thank you. Once again, if you wish to ask a question, please press star one and one on your telephone. There seems to be no further questions at this time. Please continue.
Okay, thank you. So thanks, everyone, for attending and for all the questions and your time. Have a great day. Thank you very much.
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