Novavax Stock Jumps 25% After FDA Approves Nuvaxovid Vaccine

Novavax, a biotechnology company, saw its stock surge by 25% following the approval of its new protein-based COVID-19 vaccine by the U.S. Food and Drug Administration (FDA). The vaccine, named Nuvaxovid, is designed for individuals aged 65 and above, as well as those between 12 and 64 years old who have at least one underlying medical condition that puts them at higher risk of infection. This approval marks a significant milestone for Novavax, as it is the first protein-based COVID-19 vaccine to receive FDA approval, distinguishing it from the mRNA vaccines currently on the market.

Nuvaxovid was developed in collaboration with Sanofi, a French biotechnology company. According to the agreement, Sanofi will pay Novavax 1.75 billion dollars upon the approval of the Biologics License Application (BLA). Additionally, Novavax will receive tiered royalties from future sales of the vaccine. Sanofi will lead the commercialization efforts starting this year, while Novavax will benefit from ongoing royalties from independent COVID-19 vaccine sales in future seasons. The company anticipates delivering the 2025-2026 version of Nuvaxovid for commercial use this autumn.

John Jacobs, the CEO of Novavax, highlighted the strong market demand for the vaccine. Market research and federal health data indicate that older adults and individuals with underlying health conditions are the most likely to seek seasonal COVID-19 vaccinations. This demographic is expected to drive significant demand for Nuvaxovid, given its protein-based formulation and the ongoing need for effective COVID-19 prevention measures.

Despite the recent surge in stock price, Novavax's shares have declined by 16% year-to-date. The approval of Nuvaxovid represents a pivotal moment for the company, potentially reversing its stock performance and positioning it as a key player in the COVID-19 vaccine market. The collaboration with Sanofi not only provides immediate financial benefits but also ensures long-term revenue streams through tiered royalties. This strategic partnership is expected to enhance Novavax's market presence and contribute to its overall growth in the biotechnology sector.