- Novavax(NVAX) stock is popping higher on news that its Covid-19 vaccine has been approved for use in American adults.
- The approval enables Novavax to begin commercial sales of shot Covid-19 shot in the U.S.
- Novavax comes to the vaccine party late with nearly 80% of adults in America already fully vaccinated.
Novavax(NASDAQ:NVAX) stock is up 6% today after the U.S. Centers for Disease Control and Prevention (CDC) approved its two-dose Covid-19 vaccine for use in adults.
TheCDC approvalpaves the way for Novavax to begin commercial sales of its long delayed Covid-19 vaccine in the U.S. This is an extremely positive development for the Gaithersburg, Maryland-based biotech company. Novavax has struggled with repeated delays regarding regulatory approval of its shot against the highly contagious respiratory disease.
Today’s gains bring the increase in NVAX stock to 48% over the past month. These gains come as it became clear that the company’s Covid-19 vaccine would receive approval for widespread use in America. The vaccine has already been approved in Canada and throughout Europe. However, year-to-date, Novavax’s stock is still down 58% and trading at $59 per share.
What Happened
The CDC voted unanimouslyto recommend the Novavax vaccine for people aged 18 and older in the U.S. CDC Director, Dr. Rochelle Walensky, supported the recommendation, which was the final step in approving the inoculation. The Biden administration has already ordered 3.2 million doses of Novavax’s vaccine as it prepares for this year’s cold and flu season that begins in the autumn.
For Novavax, a small biotech company, the CDC approval ends a two-year struggle to bring its vaccine to market. The Covid-19 shot is the first vaccine that the company has successfully commercialized. Novavax had received $1.8 billion of government funds to develop the Covid-19 vaccine in the early days of the pandemic but struggled to get it approved and had to watch as larger rivals,Pfizer(NYSE:PFE) andModerna(NASDAQ:MRNA) had their vaccines given the greenlight and racked up billions of dollars in sales.
Why It Matters
For consumers, Novavax’s vaccine provides a choice to people who may want to receive a Covid-19 vaccine that is based on more traditional methods than the newer Messenger RNA (mRNA) technology. The latter technology is what the Pfizer and Moderna vaccines were built upon. The regulatory approval also enables Novavax to begin sales and generating revenues for its Covid-19 vaccine, and to recoup the costs of developing the shot.
That said, Novavax islate to the vaccine partywith nearly 80% of American adults now fully vaccinated against Covid-19. However, more than 30 million adults in the U.S. are still unvaccinated, according to CDC data. This provides Novavax with some market in this country. And the company is seeking approval forbooster usagewas well.
Elsewhere, Novavax has said that it plans to concentrate its Covid-19 vaccine sales on developing nations that have been slower to secure reliable doses and carry out mass inoculation programs amongst their citizens.
In approving Novavax’s Covid-19 vaccine, the U.S. Food and Drug Administration (FDA) did flag that the shot carriesa risk of heart inflammationknown as “myocarditis.” The European Union has also flagged this issue and placed it on warning labels pertaining to the vaccine.
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