Johnson & Johnson surged Tuesday after the company said it would begin a US$1-billion-plus effort with the U.S. government to develop and manufacture a vaccine against the new coronavirus.

J&J will work with the Biomedical Advanced Research and Development Authority, or BARDA, an arm of the U.S. Department of Health and Human Services, to further develop a vaccine the company said it’s been working on since January.

J&J and BARDA will split the US$1 billion investment about 50-50, said Seema Kumar, a J&J spokeswoman.

The company said in a statement that it plans to begin building manufacturing capacity for a billion doses of the vaccine. It said it could have early doses ready for emergency use as soon as January.

J&J CEO Alex Gorsky said the company was focused on getting clinical trials conducted to find out if the vaccine works.

“At the same time we’re going to be ramping up our production,” Gorsky said in an interview on Bloomberg TV. “We expect to be in a position by the first quarter to have a much better perspective on the vaccine itself, on the kind of quantities we’ll have available by that time.”

The shares closed up 8 per cent at US$133.01 in New York. J&J said it planned to take a not-for-profit approach to the product. Kumar said it was too early to discuss exact pricing of a potential vaccine.

“This is a public health emergency, so price is not top of mind for us at this moment,” she said.

The company plans to start human trials no later than September, and said it has two backup vaccines ready for development as well.