By Peter Loftus and Joseph Walker 

The federal government awarded $2 billion to two drugmakers to support development and manufacturing of an experimental drug and a potential vaccine against Covid-19.

Novavax Inc. said it would receive $1.6 billion from the federal government' to fund clinical studies of its experimental coronavirus vaccine and establish large-scale manufacturing of doses. With the funding, Novavax said it would deliver 100 million doses of its vaccine, possibly by the end of this year.

Regeneron Pharmaceuticals Inc. said it has received a $450 million federal contract to manufacture thousands of doses of its experimental Covid-19 treatment that the government will distribute for free to the public if the drug is authorized for use by regulators.

Shares of Novavax soared nearly 37% to $108.50 early Tuesday. Shares of Regeneron rose 1.9% to $639.27.

The new funding shows the federal government is taking steps to try to ensure that more effective tools against the pandemic are ready by fall and winter. But there is no guarantee that the drug and vaccine will work safely in clinical trials.

The Regeneron contract covers an undisclosed volume of drug that Regeneron plans to have by the fall. The exact number of treatment courses covered is uncertain, Regeneron said, in part because clinical trials have yet to show what the most effective dose will be.

Regeneron is testing its drug, a combination of two antibodies, as both an antiviral treatment for people already infected, and as a method of providing temporary preventive treatment against new infections. The Tarrytown, N.Y., company said Monday it is advancing the drug into later-stage studies.

As an antiviral treatment, the contract will cover 70,000 to 300,000 treatment doses. If used preventively, a lower dose of the drug will be needed and the estimated treatment doses would range from 420,000 to 1.3 million, Regeneron said.

The contract was awarded as part of the government's Operation Warp Speed initiative and will be funded by divisions of the Department of Health and Human Services and the Department of Defense, Regeneron said.

Regeneron was previously awarded $167.5 million in federal funding to help develop its Covid-19 drug.

Operation Warp Speed is a federal initiative to accelerate the development and manufacturing of drugs and vaccines for Covid-19. The government also is backing vaccines developed by Moderna Inc., AstraZeneca PLC and Johnson & Johnson.

Novavax, of Gaithersburg, Md., started testing its vaccine, NVX--CoV2373, in May in a small study in Australia. The new federal funding will support a pivotal, "phase 3" study with up to 30,000 participants beginning in the fall, Novavax said.

Novavax's vaccine contains proteins resembling those found on the surface of the new coronavirus, which are supposed to trigger an immune response to the virus once injected. Novavax manufactures the proteins in insect cells.

Novavax, founded in 1987, has no products on the market. It is developing vaccines against influenza and other viruses.

The company's efforts have gotten a boost from the Coalition for Epidemic Preparedness Innovations, an Oslo-based nonprofit that has pledged as much as $388 million in funding for Novavax's coronavirus vaccine.

The CEPI funding is helping the company run clinical trials and begin ramping up production of doses. In return, Novavax has pledged to expand manufacturing outside the U.S. and to participate in a global allocation system for doses. Novavax currently manufactures portions of its developmental vaccines in the U.S. and Sweden.

Write to Peter Loftus at and Joseph Walker at


(END) Dow Jones Newswires

July 07, 2020 10:44 ET (14:44 GMT)

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