Novavax has announced the US Department of Defense will allocate around $60 million in financing to help produce NVX‐CoV2373, the biotech giant's COVID-19 drug candidate. The company's shares are up 15 percent during early session on Friday.
The news comes after Novavax failed to make the cut as one of five COVID-19 vaccine finalists picked for the Operation Warp Speed project of the Trump administration. Currently, the biotech is in Phase 1 of clinical tests analyzing the potential drug to combat SARS-CoV-2, the coronavirus that causes COVID-19.
The DOD has secured the multi-million funding to support the local manufacture of the experimental COVID-19 vaccine. In return, the biotech group will supply 10 million doses of NVX-CoV2373 to the defense department this year.
These doses could be administered in Phase 2 and 3 trials, but could also be used for military personnel and their families if the Food and Drug Administration gives the vaccine candidate for Emergency Use Authorization.
The announcement of the biotech's vaccine tests came last month as pharmaceutical firms halted clinical tests on vaccines for other ailments to concentrate on COVID-19, which is responsible for over 386,379 deaths around the world.
The Maryland-headquartered firm embarked on a race to develop potential coronavirus drugs on humans and disclosed that it aimed to produce more than 1 billion doses of the candidate drug in 2021. Initial results from its first batch of clinical subjects on safety and indicators of immune response is expected in July.
These vaccines are considered by health experts and world leaders as the only real solution to revive the economy following months of massive lockdowns.
The deal indicates that Novavax will collaborate with a local contract development organization to produce the vaccine's antigen - molecules from pathogen that trigger the human body's immune reaction - for at least 10 million doses. Under the terms, Novavax will also team up with third parties to ram up development of the drug's adjuvant, which boosts the immune response to the disease.
On Friday, JP Morgan market analyst Eric Joseph upgraded the biotech's stock from underweight to neutral, while maintaining his $46 stock price goal, stating current share price levels indicates the promise for the COVID-19 vaccine program. The company's stock has soared over 11-fold year-to-date thru Thursday, increasing 1,022 percent, while the S&P 500 was down 3.6 percent.
Meanwhile, the Coalition for Epidemic Preparedness Innovations is also pouring in about $388 million in funding to strengthen clinical development of NVX‑CoV2373.
