Novavax, Inc. NVAX announced that it has amended the existing agreement with Serum Institute of India Private Limited (SIIPL), the world’s largest vaccine developer, under which the latter will also manufacture the antigen component of Novavax’s COVID-19 vaccine candidate NVX-CoV2373. Following this latest development, the company is increasing its manufacturing capacity for the vaccine candidate to more than two billion doses annually, when at full capacity by mid-2021.

In August 2020, Novavax inked a license deal with SIIPL for the development and commercialization of NVX-CoV2373 in low- and middle-income countries (LMIC) and India. The agreement is expected to support minimum of 1 billion doses of NVX-CoV2373 for India and low- and middle-income countries. Per this pact, Novavax was supposed to provide both vaccine antigen and Matrix M adjuvant to SIIPL. However, with the above amendment, SIIPL will now also manufacture the antigen component of NVX-CoV2373.

Shares of Novavax were up 4.3% on Tuesday following the above-mentioned headline. In fact, the stock has skyrocketed 2672.3% so far this year compared with the industry’s increase of 1.3%.

NVX-CoV2373 is being developed using Novavax’s proprietary nanoparticle technology and includes its proprietary Matrix M adjuvant. The vaccine candidate is currently being evaluated in phase II studies after an early-stage study showed that NVX-CoV2373 was generally well tolerated and produced high levels of antibodies against the novel coronavirus. The company plans to begin phase III global efficacy studies on the same in the coming weeks.

Meanwhile, NVX-CoV2373 is being manufactured by various organizations/companies (partnered manufacturing sites) across the globe. Apart from SIIPL in India, Biofabri in Spain, FUJIFILM Diosynth Biotechnologies (FDB) in the United States and the United Kingdom, SK Bioscience in the Republic of Korea and Takeda Pharmaceutical in Japan are developing the vaccine candidate.

Notably, Novavax acquired Praha Vaccines in Czech Republic for approximately $167 million in cash during May. The buyout added a biologics manufacturing facility, located in Bohumil, Czech Republic, which will likely provide an annual capacity of more than 1 billion doses of NVX-CoV2373 starting 2021. Importantly, the antigen component of NVX-CoV2373 is being manufactured at this site.

Novavax is one of the dozen companies developing a vaccine for the deadly coronavirus disease. Several big companies, such as AstraZeneca AZN /Oxford University, Pfizer PFE along with its Germany-based partner BioNTech and Moderna MRNA already initiated their phase III studies on their respective COVID-19 vaccine candidates. In the current scenario, we expect this race against time to get an approval for a potential COVID-19 vaccine to intensify in the upcoming months.

Zacks Rank

Novavax currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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