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Novavax shares rise on news of Canadian government settlement.
It’s unclear how many doses of the vaccine from Novavax – the only commercially available product after 35 years – went unused. As part of the amended agreement, Novavax Canada will also supply fewer doses of its vaccine under a revised delivery schedule.
However, Canada may terminate the contract if Novavax does not receive regulatory approval for vaccine production at the Canadian government biomanufacturing facility by December 31, 2024, as per the agreement.
The announcement is another sign of hope for investors after the financially troubled company expressed doubts about its ability to stay in business earlier this year.
In May, Novavax adopted a more positive outlook and announced a comprehensive cost-cutting plan alongside its first-quarter earnings report. The company expects sales of between $1.4 billion and $1.6 billion in 2023.
Novavax’s stock price rose about 30% on the news, but Wall Street has yet to fully embrace the recovery plan: The company’s stock price is still down about 15% year-to-date after losing more than 90% of its value 2022.
Novavax still faces a number of challenges, including competing with Pfizer And Modern in the commercial Covid vaccine market and a pending $700 million arbitration for a terminated vaccine purchase agreement.
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