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Novavax gained traction in the early stages of the COVID-19 vaccine drive, but quickly fell behind. Manufacturing challenges and other delays slowed clinical progress, and Novavax did not receive FDA emergency use authorization until July 2022, more than a year and a half behind its mRNA rivals.
The Novavax jab, which is based on traditional protein technology, offers an alternative for people concerned about mRNA technology and provides an easy shot for distribution to hard-to-reach locations around the world.Research also suggests that it influences Few side effects Durability is also slightly longer than comparable products. But the company has struggled to gain adoption, and expects full-year sales of $800 million to $1 billion in 2023, slightly below analysts’ expectations of about $800 million. . $1.06 billion.Stock prices also plummeted over 50 last year was down 99% or more From the highs of the pandemic.
Still, the company is looking ahead to the future of its proprietary Matrix-M platform, which uses an adjuvant derived from soap tree bark from Chile, as it researches a combination coronavirus and influenza vaccine that it hopes will be on the market in 2026. He is betting on sex and sticking to that policy.
Not everyone is convinced the company is on the right track long term.
Shah Capital, which currently owns 7.5% of Novavax’s common stock, announced last month that Leadership “transformation” At work. The investor cited Novavax’s main “value destroyers” as “huge market failures, non-existent partnership strategy, lack of clear understanding of the technology, questionable regulatory management, and continued operating losses and inefficiencies.” listed. Ultimately, Mr. Shah recommended two industry veterans as candidates for the company’s board.
This is not the first time Mr. Shah has made a fuss about the company’s performance.
“The science is great. It works. (But) maybe someone like Sanofi or Pfizer should buy this company.”
Himanshu Shah
Shah Capital Founder, President, CIO
“We wrote our first letter in 2023 because they were spending money like drunken sailors,” Shah founder, president and chief investment officer Himanshu Shah said in an interview. he said. “So we asked them to be more efficient with their money.”
Shah said that although the circulating strain of the coronavirus has stabilized and the virus behaves more like the flu, Novavax has not been able to take advantage of the push for annual booster shots. In particular, Novavax has been unable to properly market its vaccine or widely penetrate retail pharmacies, which are used by more than 95% of Americans. I received the seasonal shot last year.
“The company really messed up its marketing,” Shah said. “People don’t even know we exist.”
long term play
In early 2023, Novavax CEO John Jacobs explained ‘Uncertainty’ surrounding company’s future at financial results conference raises concerns about threatening company’s future face bankruptcy. The company implemented cost-cutting strategies and reduced its 30% of employees to maintain operations, 500 million dollars Research and development expenses and other operating expenses increased in 2023 compared to the prior year.
“They’ve done a phenomenal job of coming out of the woods,” said Mayank Mamtani, managing director and head of healthcare at B. Riley Securities. “They do everything a company is supposed to do when a market comes along, like with COVID-19, and then it just disappears.”
Shah’s recent letter has already “added pressure” to Novavax, but Mamtani said no new complaints have arisen at the highest level. But Mamtani said Shah’s concerns were “reasonable” and that Novavax needed “more agile “This is a reminder of the need to act,” he said.
“Novavax is going back to its roots and focusing on its platform and developing a combination of COVID-19 and influenza. I think this will be interesting and hopefully in time,” Mamtani said. Ta.
“Novavax is here to stay, but it’s going to be a tough journey to raise money again and again.”
mayank mamtani
B. Riley Securities, Managing Director and Head of Healthcare
The company’s only other candidate is a malaria vaccine developed by the University of Oxford and the Serum Institute of India using Novavax’s Matrix-M platform, the post said. Good results of phase 3 Ever since the beginning of this year Recommended deployment in 2024 According to WHO.
Otherwise, Shah is frustrated that the company has no other publicly known research and development programs. Ultimately, he thinks Novavax should expand its research and development capabilities to a variety of infectious diseases.
But Mamtani warned that vaccine development is a “multi-year endeavor” and that Novavax could face challenges even as it pursues ideal targets like RSV.
“RSV is logical, but it’s also a competitive arena now. So they have to pick their battles between clinical trials and clinical development,” Mamtani said.
Takeover target?
Novavax said in an emailed statement that it believes leveraging its platform to advance protein-based vaccines is the right move to “drive long-term sustainable growth.”
While Shah is optimistic about the prospects of Novavax’s platform, estimating that it is “worth a lot of money,” the technology could be used by more established vaccine developers “in better hands.” He also said that he believed that he would be able to enter the
“The science is great. It works,” Shah said. “(But) maybe a company like Sanofi or Pfizer should buy this company.”
With interest in coronavirus-related vaccine development waning, Mamtani said Novavax likely won’t be an attractive acquisition target. Instead, a new partnership could give the company the boost it needs.
“I think Novavax is here to stay, but it’s going to be a tough journey to raise money again and again,” he said. “I wish I had a partner who would cover some of the costs.”
In its last earnings release, Novavax said it expects this year’s revenue to be flat compared to 2023. In addition to continued cost savings, the company also plans to transition its COVID-19 vaccine delivery from five-dose vials to prefilled syringes. The first earnings report for 2024 is expected to be released in the coming weeks.
Despite the struggles, Mamtani argued that Novavax still has an opportunity to profit from selling its coronavirus vaccine, even if it represents only 10% of the market.
“There’s a business here that should be profitable,” he said. “Long term, the company is definitely an important company because they have a platform and products in development. They need more than just mRNA, so they should be able to gain significant market share. ”
