*

USDA says new vaccines will match current virus strain

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Current outbreak has killed over 130 million birds in all

50

states

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Trade risks hinder immediate vaccine deployment,

Agriculture

Secretary Vilsack has said

(Adds impact on egg prices, paragraph 2, background, quotes on

prior vaccine development in paragraphs 8-12)

By Leah Douglas and Tom Polansek

Jan 8 (Reuters) - The U.S. will rebuild a stockpile of

bird flu vaccines for poultry that match the strain of the virus

circulating in commercial flocks and wild birds, the Department

of Agriculture said on Wednesday, in a sign of the widespread

and devastating nature of the nation's persistent outbreak.

The outbreak, which began in poultry in early 2022, has

killed more than 130 million commercial, backyard and wild birds

in all 50 states, according to the U.S. Centers for Disease

Control and Prevention. Deaths of millions of egg-laying hens

pushed wholesale egg prices to record highs last month.

Bird flu is also circulating among dairy cattle herds and

has infected nearly 70 people, most of them farm workers exposed

to sick poultry or cattle. The U.S. reported its first human

death related to bird flu on Monday.

The U.S. built a poultry vaccine stockpile after the prior

major bird flu outbreak in 2014 and 2015, though the vaccines

were never used, the agency said in a press release.

"USDA believes it is prudent to again pursue a stockpile

that matches current outbreak strains," the release said.

Egg and turkey farm groups have called for deploying a

vaccine, citing the economic toll for farmers of killing their

flocks.

Agriculture Secretary Tom Vilsack has said such deployment

would not be possible in the short term, in part due to trade

risks. Many countries ban imports of vaccinated poultry over

concerns the vaccine could mask the presence of the virus.

The vaccines purchased by USDA following the prior bird flu

outbreak were developed by Merck & Co ( MRK ), Ceva ( CEVA ) and

one by U.S. government researchers, said David Suarez, who was

acting laboratory director of the USDA's Southeast Poultry

Research Laboratory in Athens, Georgia, in a 2023 interview.

"All the vaccines they purchased expired, and they threw it

away," Suarez said in 2023.

Suarez at the time said there was limited appetite for

rebuilding a vaccine stockpile until it was likely birds would

be vaccinated.

"There's not an appetite of using the limited resources on

something that only has a shelf life of two to three years," he

said.

Animal health company Zoetis ( ZTS ) reached out to USDA

during the 2022 outbreak and was told the government did not

plan to make new purchases for its vaccine stockpile, the

company said in 2023.

The USDA also said it has enrolled 28 states in its national

bulk milk testing program to detect bird flu in dairy herds, and

that testing so far had not detected new infected herds in

states that previously were virus-free.

In the past 30 days, USDA has reported infected herds in

California and Texas, according to agency data.