Vaxart: A Strong Buy For Their Oral Tablet Covid-19 Vaccine

Vaxart (VXRT) is a small cap, clinical-stage biotech company, based in South San Francisco, Calif., that develops oral tablet vaccines, which the company believes represent "an important advancement in vaccination technology".

I have previously covered VXRT, see here and here, if interested.

In recent weeks, the company has announced several positive material news regarding their COVID-19 program:

• IND filed,
• positive preclinical (mice) results,
• IND clearance and starting phase 1 trial enrollment,
• first subject being dosed,
• positive topline data from a hamster challenge study,
• provided guidance for the OWS-funded NHP [non-human primate] study results, the first data from the phase 1 trial and planned phase 2 trial (Q4, 2020; see Side 19)

Given the fact that the front-runners of COVID-19 vaccine candidates (e.g. those of PFE/BNTX, MRNA, AZN/Oxford, JNJ etc.) are much further ahead in development (i.e. are already in or near completion of their respective phase 3 trials), many may doubt the competitive relevance of later comers, such as VXRT's oral tablet vaccine candidate.

For the purpose of simplicity, I will mention three items here for consideration.

First, while it is true that the forerunners are further ahead than VXRT's oral tablet vaccine candidate, it should be noted that all the forerunners are injectable vaccine candidates, using various approaches.

This means that most, if not all, of these front-runners pose much greater challenges for manufacture at scale, for distribution (e.g. requirement of the cold-chain) and for a successful global vaccine campaign, than VXRT's room temperature stable, needle free oral tablet vaccine.

As the saying goes, "A picture is worth a thousand words!" Perhaps the picture below can communicates more efficiently the aforementioned point.

(Source)

Secondly, as articulated in this BMJ article entitled

Will covid-19 vaccines save lives? Current trials aren’t designed to tell us"

there may exist significant limitations for the current front-runners' phase 3 trial designs.

Therefore the authors think that the efficacy of the front-runners is far from certain, especially in term of stopping the transmission; and in the efficacy among the elderly and minorities who are under-enrolled (studied) in the current phase 3 trials.

Finally, in this article, the author wonders if EUA [emergency use authorization] of any vaccine does in fact pose great ethical challenges to all (ongoing and future) COVID 19 vaccine trials, as to undermine the development of all vaccines.

This is what the author said concerning the challenges:

The emergency use authorization (EUA) of a COVID-19 vaccine will create two sets of problems related to placebo-controlled trials. Patients enrolled in the ongoing Phase III trial of the authorized vaccine will want to know whether they received a placebo. Of those who did, some will very likely want to get the vaccine, which would disrupt the ability to gather long-term safety and efficacy comparisons between the vaccine and placebo arms.

The second set of problems involves individuals who have enrolled in trials of other vaccine candidates. Volunteers who have enrolled in a trial of a vaccine candidate that has not received an EUA are likely to want to know if they’ve received a placebo. If so, they may want to drop out of the trial and receive the authorized vaccine. Participants in the vaccine arm of the trial may want to know if it is safe for them to also receive the authorized vaccine."

In other words, the author thinks that the EUA of any vaccine will seriously challenge the continuity or the standard of having a placebo arm in any vaccine trial.

A few ideas have been mentioned to meet these challenges: conducting non-inferiority trials, or using external control arms, or real-world data as controls, which will require the regulators (e.g. the FDA, the EMA, Health Canada etc.) to work diligently and closely with the companies to resolve the potential issues before they become a reality.

Nevertheless, all these separate items point to a common theme: uncertainty ahead for the COVID-19 vaccine front-runners.

All this is to say, I think given these limitations and challenges of the forerunners, there remains a need for other late comers using different approaches, such as VXRT's oral tablet vaccine candidate:

• with a unique (advantageous) mode of manufacture, distribution, administer from others.
• with potentially comparable or better efficacy than others for being an oral vaccine, which has shown in prior studies to be able to trigger both systemic and mucosal immunity and not just systemic immunity as observed in the injectable vaccines.

In conclusion, VXRT is a BUY in my opinion for their oral tablet COVID vaccine that is currently in phase 1 trial, expecting to enter phase 2 in Q4, 2020.

To date, VXRT has reported positive preclinical results in mice and hamster models and is expecting to report on the NHP challenge study soon.

VXRT's oral vaccine platform has to date completed 12 human trials, against 6 viruses, all with positive (promising) safety and efficacy data.

If successfully developed and launched, VXRT's oral tablet vaccine is likely to be very competitive in its adoption, in my estimate, given it's uniqueness of being an oral tablet vaccine.

And since it's the smallest in terms of market cap size (~$595M MC Oct 22, 2020) among the vaccine peers (e.g. PFE $208B, BNTX $21B, MRNA $28B, JNJ $382B), any revenue from a successful approval and commercialization of its oral tablet COVID vaccine will without doubt justify a big increase in VXRT's valuation, in my opinion.

However, for any potential investor, please be mindful of the significant risks associated with investing in this company.

The significant risks include and not limited to: possible trial failures, dilution risk, great volatility, risk from legal matters, significant short interest as well as the market, or sector risk that is common to all stocks and the significant risk of being a small cap biotech company that has very limited resources (human and financial).

Please always conduct your own due diligence and carefully consider your own risk tolerance and investment time frame before making any investment decision.

Thanks for reading and all the best!

Disclosure: I am/we are long VXRT. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Additional disclosure: We are also long BNTX, TBIO