Shares of Novavax are down more than 6% as the drugmaker delayed the start of the US late-stage trial of its COVID-19 vaccine candidate by about a month.
In an update on the Phase 3 trials of NVX-CoV2373, Novavax’s (NVAX) vaccine candidate, the company said that it will roll out the pivotal clinical trial in the US and Mexico by the end of November. The trial, which is set to enrol up to 30,000 participants, was expected to begin this month. Meanwhile, Novavax said that although it has made significant progress in large-scale vaccine manufacturing, it experienced some delays versus its original timing estimates.
NVX‑CoV2373 is a stable, prefusion protein made using Novavax’s recombinant protein nanoparticle technology and includes the company’s proprietary Matrix‑M adjuvant. The company has been engaged in large-scale manufacturing at multiple sites around the world and plans to use production capacity from its FUJIFILM North Carolina contract manufacturing site in the US Phase 3 clinical trial.
Novavax said that data from its ongoing Phase 1/2 clinical trial, including new Phase 2 reactogenicity data, will be presented on Oct. 30.
Commenting on the progress in the UK, Novavax updated investors that the Phase 3 trial has enrolled over 5,500 participants to date. The study will be expanded to 15,000 volunteers from the 10,000 originally planned to facilitate assessment of safety and efficacy in a shorter time-period. Novavax expects the trial to be fully enrolled by the end of November with interim data to be released in the first quarter of 2021. These data are poised to serve as the basis for global licensure, the company added.
“We are pleased with the significant progress made in our Phase 3 clinical trial since it began in the United Kingdom at the end of September,” said Novavax’s President of R&D Gregory M. Glenn. “We are grateful for the support of the U.K. Government’s Vaccines Taskforce (VTF) and the National Institute for Health Research (NIHR) for our pivotal trial. Recognizing the recent, large increase in the number of COVID-19 cases in the U.K., as well as the rapid progress in participant enrollment for our trial, in consultation with the VTF and NIHR, we adjusted our plans and increased enrollment.”
Novavax’s vaccine candidate has been selected to be part of Operation Warp Speed (OWS), a US government program that seeks to begin supplying millions of doses of a safe and effective vaccine for COVID-19 in 2021. As part of the program, the company has been awarded with $1.6 billion in funding for testing and manufacturing as well as the supply of 100 million doses of the potential vaccine to the US.
In the run-up to developing a coronavirus vaccine candidate, the stock has this year exploded 2,151%. However, NVAX has seen some sell-off activity recently, as the stock has shed about 40% over the past 3 months. (See Novavax stock analysis on TipRanks).
Following the update, B. Riley Financial analyst Mayank Mamtani reiterated a Buy rating on the stock with a $223 price target (166% upside potential), saying that the UK trial progress makes up for the delayed US study.
“Our optimism is derived from Ph. III U.K. study benefiting from a high infection rate, i.e., increasing since trial initiation in Sep’20, from 6.6k cases/day to 20.9k cases/day; mgmt. expects to complete enrollment by end of November,” Mamtani wrote in a note to investors. “We view this pace of both enrollment and anticipated events to compare favorably relative to that observed with Ph. III U.S. trials from PFE (95%/80% of 44k subjects enrolled/received second dose) and MRNA (fully enrolled 30k subjects) that initiated in late July.”
The rest of the Street has a cautiously optimistic stance on the stock’s outlook. The Moderate Buy analyst consensus shows 4 Buy ratings versus only 1 Sell rating. Meanwhile, the $220.80 average analyst price target indicates a promising 163% upside potential from current levels.
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