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Barry Cohen
Barry Cohen
Articles (141) 

Novavax Hopes to Reverse Past Setbacks With Covid-19 Vaccine

Biotech receives nearly $400 million grant to advance its immunization against the coronavirus

May 22, 2020 | About:

Novavax Inc.’s (NASDAQ:NVAX) stock is a shadow of its former self, but shares did get a boost when the Gaithersburg, Maryland-based biotech recently received $384 million from a foundation to help the company develop a vaccine against Covid-19. To further aid in the effort, the company filed a prospectus to sell up to $250 million worth of common stock.

The latest cash infusion from the Coalition for Epidemic Preparedness Innovations brings to $388 million the foundation has funneled to Novavax, which is one of several companies working on a Covid-19 immunization.

The award was the largest to date until this week, when AstraZeneca (NYSE:AZN) received support of more than $1 billion from the U.S. Biomedical Advanced Research and Development Authority for the development, production and delivery of its vaccine. AstraZeneca plans to conduct a phase 3 clinical trial with 30,000 participants, as well as pediatric trial.

Novavax created its Covid-19 candidates using its proprietary recombinant protein nanoparticle technology platform. The company has experience working with other coronaviruses, including MERS and SARS. It hopes to have a Covid-19 vaccine candidate in phase 1 tests in a matter of weeks. The company is also scaling up manufacturing to produce 1 billion immunizations in 2021, according to an article in BioCentury.

The CEPI announcement gave Novavax shares a much needed shot in the arm, boosting its price to a year-to-date high of $61.50. Since then, the shares have retreated to around $46. About a year ago, the company was rattled by NASDAQ, which warned its stock would be delisted if the price didn’t get past $1 in the following six months. Novavax avoided that ignominy by effecting a one-for-20 reverse stock split shortly thereafter.

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In the past five years, Novavax has lost 80% of its value due to a number failed tests of its vaccines, the latest occurring this past September, when European regulators nixed authorizing the company’s drug for a respiratory infection, according to a piece in the Washington Business Journal. In a bit of good news, the company recently announced that its NanoFlu scored encouraging top-line results in a pivotal phase 3 clinical trial. The immunization is for seasonal flu in people 65 and older.

Perhaps brighter days are ahead for the Novavax and its shareholders.

Disclosure: The author holds no positions in any of the companies mentioned in this article.

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About the author:

Barry Cohen
Barry Cohen has nearly 40 years experience in communications and marketing, the majority in senior positions at large international health care companies, including Abbott Laboratories and Bayer Inc.

He has contributed to a number of financial websites, writing primarily about the stocks of health care companies.

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