A vial labeled “Novavax V COVID-19 Vaccine” is seen in this illustration taken on January 16, 2022.
Ruvik Dice | Reuters
shares Novavax Wall Street welcomed the company’s new multi-billion dollar deal with the French drugmaker on Monday, sending shares soaring 50% Sanofi That creates a dramatic turnaround for the troubled vaccine maker.
Novavax shares nearly doubled on Friday after announcing a deal with Sanofi. Novavax said on Friday that the deal allows the company to lift its “going concern” warning, which it first issued in February 2023 due to significant doubts about its ability to remain viable.
“It has really helped our business. It has allowed us to remain well capitalized, removed the burden of going concern and given us the opportunity to pivot our strategy more towards what we do best – serving all of our stakeholders “We will bring additional value to our shareholders, including our shareholders,” Novavax CEO John Jacobs said in an interview with CNBC.
Under the agreement, Sanofi will hold less than 5% of Novavax. The deal also entitles Novavax to $500 million in upfront cash as well as future payments based on certain milestones and royalties.
Sanofi, one of the world’s largest vaccine makers, will co-market Novavax’s Covid vaccine in most countries starting in 2025. New vaccine products.Shots included Combination vaccine against COVID-19 and influenza.
A sign on the Sanofi exhibition space during the Viva Technology conference dedicated to innovation and new ventures at the Porte de Versailles exhibition center on June 15, 2022 in Paris, France.
Benoit Tessier | Reuters
Jefferies analyst Roger Song said in a report on Sunday that the deal would provide Novavax with significant capital and support the company’s growth.
“From an economic perspective, the deal is highly profitable and far-reaching,” Song wrote.
He said the upfront payments help allay investor concerns about Novavax’s going-concern warning and that the milestone payments are “significant and relatively near-term” for the company because they are not tied to sales. At the same time, royalties will provide a stable source of income every year, Song said.
He added that the deal “validates” the company’s protein-based vaccine platform.
Novavax’s vaccine is the first COVID-19 vaccine to use protein technology, a decades-old approach used in viruses used in conventional vaccines against hepatitis B and shingles. Health officials believe the vaccine is a valuable alternative for people who don’t want to receive a messenger RNA shot. Pfizer and modern.
Leerink Partners analyst David Risinger said in a note on Sunday that he is interested in seeing whether Sanofi is effective in raising consumer awareness about how the side effects of Novavax’s Covid vaccine compare to competing vaccines from Pfizer and Moderna Make it easier for patients to tolerate.
Risinger noted that consumer hesitancy about coronavirus vaccine boosters stems in part from concerns about fatigue and discomfort associated with the Pfizer and Moderna shots.
Risinger wrote that the company expects Sanofi “to drive greater commercial success of the (Novavax) vaccine starting in 2025 due to its commercial scale and contracting capabilities, but it is difficult to predict the extent of the impact.”
Sanofi and Novavax could have “further upside” if they develop a combined coronavirus and flu vaccine that offers advantages over the mRNA combination vaccine being developed by Pfizer and Moderna, he added.
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