Actions of Novavax (NASDAQ: NVAX) plunged 19.6% on Friday after the biotechnology has delayed plans to seek emergency use authorization for its coronavirus vaccine candidate.
Novavax had previously hoped to get regulatory clearance by May, before extending its timeline to the third quarter. The company now plans to submit its application to the United States Food and Drug Administration (FDA) in the fourth quarter.
The delays likely cost Novavax the potential for billions of dollars in sales, which instead went to rival vaccine makers like Pfizer and Moderna.
The Novavax share price fell sharply on Friday. Image source: Getty Images.
Novavax CEO Stanly Erck told Yahoo Finance the latest schedule is due to production issues. Novavax has been tasked with working with some manufacturers as part of Operation Warp Speed, a government-run program designed to accelerate the development of COVID-19 vaccines and treatments. One of these manufacturers is struggling with quality control issues, which has temporarily halted production.
Investors are understandably disappointed by these delays. However, the battle against COVID-19 is unlikely to be won this year. Health officials warn the disease could become endemic and booster shots may be needed to protect against new variants. Thus, the need for safe and effective coronavirus vaccines is expected to remain significant for the foreseeable future. So, if Novavax can get emergency use authorization for its medicine by the end of the year, it could still generate significant vaccine-related benefits in the years to come.
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