Novavax Slumps on Dismay Over Vague Timelines for Covid Vaccine

(Bloomberg) -- Novavax Inc. shares dropped Monday after a Washington Post report said the biotech may not seek emergency use authorization for its closely-watched Covid-19 vaccine until June at the earliest -- a delay that spooked investors on top of manufacturing concerns.

The drug developer will not publish results from a highly-anticipated study of the vaccine until the end of the month, according to the report, which is weeks later than many on Wall Street anticipated. The biotech, which has soared more than 4,000% since the start of 2020, tumbled as much as 9.9% as the article removed an immediate catalyst for the stock.

Investors fear there may be issues beyond just a simple delay in the vaccine’s results that may be preventing it from filing for emergency use. The company also needs to reach an agreement with U.S. regulators over issues for an assay, which helps check the quality of its vaccines, the report said. That could cause the delay to drag on longer.

Representatives for Novavax did not immediately respond to an email inquiry for comment on the Washington Post story.

“These are growing pains and I would remind investors this will be a three horse race basically between Moderna, BioNTech-Pfizer and Novavax,” B. Riley analyst Mayank Mamtani said by telephone. “This is a great entry point for investors,” Mamtani, who rates shares at a buy and has a Street-high price target of $365, added.

While Novavax and vaccine developing peers were hit last week by concerns surrounding a U.S.-backed effort to waive patent protection for Covid-19 vaccines, Monday’s news flow was less cut and dry. As Novavax headed toward its lowest close in two months, peer BioNTech SE rallied as much as 10% after raising its Covid-19 vaccine sales forecast to $15.1 billion for this year.

Novavax is due to report quarterly results after the bell Monday, and analysts will be paying close attention to any comments on the delayed timelines for the Covid-19 vaccine. Earlier the biotech published positive results from a combination trial of its Covid-19 vaccine candidate and its seasonal flu vaccine in hamsters.

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