Evaxion Soars 36% on Merck Licensing Deal: AI-Driven Vaccine Validates Biotech Breakthrough

Summary
• Merck licenses Evaxion’s EVX-B3 vaccine candidate for $7.5M upfront, extending cash runway to H1 2027
• Stock surges 36.37% intraday, trading at $4.5001 with $65.8M turnover
• EVX-B3 targets a pathogen with no existing vaccines, validated by Merck’s AI-Immunology platform

Evaxion’s stock erupted on news of Merck’s licensing deal, surging 36.37% to $4.5001 amid a $65.8M surge in turnover. The deal, anchored by a $7.5M upfront payment and potential $592M in milestones, underscores Merck’s confidence in Evaxion’s AI-discovered vaccine. With EVX-B3 addressing a critical unmet medical need and EVX-B2’s evaluation extended, the biotech’s strategic pivot to high-impact partnerships is reshaping its financial and technical trajectory.

Merck's Licensing Deal Validates AI-Immunology Platform
Evaxion’s 36.37% intraday surge was catalyzed by Merck’s $7.5M upfront payment for EVX-B3, a preclinical vaccine targeting a pathogen with no existing solutions. The deal, part of a 2024 collaboration, extends Evaxion’s cash runway to H1 2027 and positions the company to earn up to $592M in milestones plus royalties. Merck’s decision to assume full development responsibility validates Evaxion’s AI-Immunology platform, which identified novel vaccine targets for a historically challenging pathogen. The extended evaluation period for EVX-B2 (Gonorrhea) further signals Merck’s interest in Evaxion’s pipeline, amplifying investor optimism.

Technical Bull Case: Breakout Above $4.75 Intraday High
• MACD: 0.0663 (bullish divergence), RSI: 77.08 (overbought), Bollinger Bands: Price at $4.5001 vs. upper band $3.2389 (contraction suggests volatility)
• 200D MA: $2.246 (far below current price), 30D MA: $2.9706 (support level), 100D MA: $2.572 (key resistance)

Evaxion’s technicals align with a short-term bullish breakout. The RSI at 77.08 signals overbought conditions, but the MACD’s positive divergence and 200D MA lagging far below current price suggest momentum. Key levels to watch: $4.75 (intraday high) as a breakout target and $3.9601 (intraday low) as support. With no options data available, a long position into a pullback to the 30D MA ($2.9706) could capitalize on the AI-validated narrative. Aggressive traders may consider a 5% upside projection to $4.7251, aligning with the intraday high.

Backtest Evaxion Stock Performance
Below is the back-test result for the “36 % Intraday-Surge” strategy on Evaxion (EVAX.O) covering 1 Jan 2022 – 25 Sep 2025.Key metrics (2022-01-01 → 2025-09-25):• Total return: -97.7 %• Annualized return: -36.5 %• Max draw-down: 99.1 %• Sharpe ratio: -0.30Interpretation:1. Only one ≥36 % spike occurred in the period; buying after it led to a near-total loss as EVAX trended down.2. Negative Sharpe and extreme draw-down highlight very poor risk-adjusted performance.3. Such single-event momentum on a micro-cap biotech carries severe downside without risk controls (e.g. tight stop-loss).Feel free to explore alternative entry/exit rules or add risk parameters (stop-loss / take-profit) if you want to test improvements.

Hold for Breakout or Reentry: Merck’s Bet on AI-Driven Vaccines
Evaxion’s 36.37% surge reflects Merck’s validation of its AI-Immunology platform, with EVX-B3’s development and EVX-B2’s extended evaluation offering long-term upside. While the RSI suggests overbought conditions, the MACD and moving averages indicate sustained momentum. Investors should monitor the $4.75 intraday high as a breakout threshold and the $3.9601 low as a reentry trigger. With Amgen (AMGN) down 1.32% as a sector leader, Evaxion’s AI-driven partnership model positions it as a standout in a mixed biotech landscape. Hold for a breakout above $4.75 or reenter on a pullback to $3.9601.