Bringing a Covid-19 vaccine to market is proving extremely tricky for Novavax (NVAX). After the biotech’s proposed vaccine delivered excellent results in late-stage trials which matched the standard of other approved vaccines, the company has continually delayed filing for approval in various regions including the US.
The story took another wrong turn on Wednesday when a Politico article cited “anonymous sources” who claimed Novavax’ manufacturing problems ran deeper than previously thought; the company was facing “significant hurdles in proving it can manufacture a shot that meets regulators’ quality standards.”
Shares did what shares do in such a situation and duly tanked in Wednesday’s session by 15%, even though the company responded by saying it is still on track to submit filings to regulatory authorities, including the FDA by the end of the year.
“Key for us,” says Cantor Fitzgerald’s Charles Duncan, “Is that Novavax is past commercial scale-up activities and is finalizing the submissions.”
“We believe that filing submissions will dissipate the current debate of vaccine quality and the release assays, for which the company has received input and commentary by the agency as it was developing it,” the 5-star analyst went on to say.
Before submitting the final Chemistry, Manufacturing, and Control (CMC) package, Novavax is currently evaluating those assays “against product.”
Furthermore, per management, conversations with all of the regulatory authorities are ongoing with the feedback incorporated into the submissions; the company anticipates it will begin the filing process over the next several weeks.
Novavax is also sticking to its guidance for 150 million doses of “monthly run rate capacity” by the year’s end and is “working to create consistency across all of the manufacturing sites.” Duncan expects an update on the 3Q21 earnings call on November 4.
The negative news has done little to dampen Duncan’s enthusiasm; the analyst maintains a Buy rating along with a $272 price target, implying shares will almost double in value over the one-year timeframe. (To watch Duncan’s track record, click here)
Novavax currently has two other analysts following its progress and they are both positive, resulting in the stock’s Strong Buy consensus rating. The average price target even trumps Duncan’s; at $290, the figure represents potential 12-month gains of 112%. (See Novavax stock analysis on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
