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A health worker prepares a dose of the Novavax vaccine as the Dutch Health Service Organization begins the Novavax vaccination program on March 21, 2022 in The Hague, Netherlands.
Patrick Van Catwijk | Getty Images
shares novafax It jumped more than 50% on the Tuesday post company Unveiled promising New vaccine data And a broad push to cut costs includes massive layoffs.
The announcements are a sign of hope for investors after the most recent quarter, when the biotech company raised doubts about its ability to stay in business and decided not to provide guidance for the full year. Novavax shares are now up about 6% so far this year, giving it a market capitalization of nearly $950 million.
Novavax is now betting on its cost controls and new vaccines to help it stay afloat, and it forecasts 2023 sales of $1.4 billion to $1.6 billion, according to it. First quarter earnings report.
The Gaithersburg, Maryland-based company said its combination vaccine targeting both Covid and influenza produced a strong immune response against the viruses and was well tolerated in a phase two trial. Novavax shared the results of similar trials on its standalone flu vaccine and its new high-dose Covid vaccine.
The company’s Covid vaccine is the only product to be marketed after 35 years in business.
Novavax also announced a global cost-cutting plan, which will include cutting 25% of the company’s workforce. A Novavax spokesperson told CNBC that about 20% of the company’s 2,000 full-time equivalent workers will be affected.
The plan also includes the integration of the company’s facilities and infrastructure.
Novavax expects the plan from 2023 to reduce R&D and general and administrative insurance expenses by about 20% to 25% compared to those costs in 2022. The company mentioned R&D expenditures amounted to US$258 million and SG&A expenditures amounted to US$162 million last year.
The plan is also expected to reduce research, development, reconstruction and response costs for 2024 by about 40% to 50% compared to 2022.
“Novavax is focused on significantly reducing our expenses while retaining key capabilities needed to execute our operating plans,” the company said in the statement.
Novavax still reported a dismal first quarter, unprecedented in Wall Street estimates.
The biotech company reported first-quarter sales of $81 million, down from the $704 million it reported during the same period last year. Novavax said the sharp decline was due to an “emerging seasonal pattern” of COVID vaccines.
Analysts expected the company to generate $87.6 million in revenue in the quarter, according to a Refinitiv survey.
Novavax reported a net loss of $294 million, or $3.41 per share, compared to net income of $203 million, or $2.56 per share, during the first quarter of 2022. Analysts estimate that the company will post a loss of $3.46 per share, Refinitv said. scan.
Novavax’s path to launching a Covid vaccine in the United States has been difficult.
The company raced against Pfizer and Moderna to develop the first Covid vaccine early in the pandemic. But Novavax’s efforts have been stymied before manufacturing hurdles and organizational mistakes that make the company lag behind its competitors.
The Novavax shot finally won FDA approval last year, but its absorption has been slow.
The FDA in October, too sign out On the Novavax covid booster. But most Americans had already chosen the updated Omicron boosters from Pfizer and Moderna by that time.
The Novavax vaccine is the first Covid vaccine to use protein technology, a decades-old method for fighting viruses used in routine vaccines against hepatitis B and shingles.
The shot works differently than its mRNA-based counterparts from Pfizer and Moderna but achieves the same result: teaching your body how to fight off Covid.
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