- Announces co-exclusive licensing agreement with Sanofi to
co-commercialize COVID-19 vaccine, develop novel COVID-19-Influenza
combination vaccines and develop multiple new vaccines utilizing
Novavax's Matrix-MTM adjuvant
- This agreement represents a potential multi-billion dollar
revenue opportunity for Novavax including:
- $500 million upfront
payment
- Approximately $70 million
equity investment in Novavax
- Up to $700 million in COVID-19
and combination product near-term milestones, plus ongoing tiered
royalties on product sales
- Up to $200 million in
milestones plus royalties for each new vaccine developed utilizing
Novavax's
Matrix-MTM adjuvant
- Announces addition of standalone influenza vaccine to Phase
3 COVID-19-Influenza Combination vaccine trial, which is on-track
to initiate second half of 2024, with potential 2026 launch for
both candidates
- Reduced current liabilities by an additional $831 million during Q1 2024
- Achieved total revenue in Q1 2024 of $94 million
- Novavax removes going concern notice
- Company to host conference call today at 8:30 a.m. ET
GAITHERSBURG, Md., May 10, 2024 /PRNewswire/ -- Novavax,
Inc. (Nasdaq: NVAX), a global company advancing protein-based
vaccines with its Matrix-M™ adjuvant, today announced its financial
results and operational highlights for the first quarter ended
March 31, 2024.
Earlier today, Novavax and Sanofi (NASDAQ: SNY) announced that
they have entered into a co-exclusive licensing agreement. The
terms of the agreement include: a co-exclusive license to
co-commercialize Novavax's current stand-alone adjuvanted COVID-19
vaccine worldwide (except in countries with existing Advance
Purchase Agreements [APAs] and in India, Japan
and South Korea where Novavax has
existing partnership agreements); a sole license to Novavax's
adjuvanted COVID-19 vaccine for use in combination with Sanofi's
flu vaccines while Novavax retains the right to and is developing
its own COVID-19-Influenza Combination (CIC) vaccine candidate; a
non-exclusive license to use Novavax's adjuvanted COVID-19 vaccine
for use in combination with non-flu vaccines; and a non-exclusive
license to use the Matrix-M adjuvant in vaccine products. In
addition, Sanofi will take a minority (<5%) equity investment in
Novavax.
"Today we announce the beginning of an exciting new chapter for
Novavax with the launch of a strategically important partnership
with one of the world's leading vaccine companies. We believe the
combined strength of Novavax and Sanofi will enable us to better
fulfill our mission of developing and improving access to
life-saving vaccines," said John C.
Jacobs, President and Chief Executive Officer, Novavax. "I
am proud of the progress our Company has made this quarter as we
continue to advance our COVID-19 vaccine for the upcoming 2024-2025
vaccination season and plan for the launch of our Phase 3 CIC and
standalone influenza program in the second half of this year."
The agreement is further validation of Novavax's technology
platform and provides significant opportunity to drive value
creation and benefit global public health. It strengthens
Novavax's balance sheet and cash flow position, providing the
opportunity to focus more on research and development and pipeline
expansion to accelerate growth and generate long-term value for
shareholders.
Sanofi Agreement Highlights
Financial Highlights
- This agreement represents a potential multi-billion dollar
revenue opportunity for Novavax.
- The total value of near-term upfront payments, Sanofi's equity
investment and potential milestones associated with Nuvaxovid™
sales and the development of Sanofi's flu-COVID-19 combination
vaccine equate to approximately $1.3
billion.
- Novavax will receive an upfront payment of $500 million within 10 days.
- Novavax will receive today an equity investment of
approximately $70 million in Novavax
common stock for a 4.9% minority interest.
- Novavax is eligible to receive up to $350 million in milestones for activities related
to Nuvaxovid.
- Novavax is eligible to receive up to $350 million in additional milestones for
Sanofi's flu-COVID-19 combination vaccine.
- In addition, Novavax is eligible to receive royalties
associated with the ongoing sales of Nuvaxovid and Sanofi's
flu-COVID-19 combination vaccine and any other combination vaccines
Sanofi may develop including Nuvaxovid.
- And finally, for each additional Sanofi vaccine product
developed under the non-exclusive license with Novavax's Matrix-M
adjuvant technology, Novavax is eligible to receive additional
launch and sales milestones of up to $200
million per product plus ongoing product royalties.
Additional Highlights
- Novavax is eligible for cost reimbursement by Sanofi of certain
R&D and medical affairs costs, select technology transfer costs
and supply of COVID-19 and Matrix-M adjuvant.
- Sanofi will be solely responsible for the development and
commercialization of any novel flu-COVID-19 combination product
containing a Sanofi flu vaccine, and any other combination products
they may develop utilizing Nuvaxovid and any other new vaccines
they develop utilizing the Matrix-M adjuvant.
- Outside of the collaboration, each party may develop and
commercialize their own COVID-19-Influenza combination vaccines and
adjuvanted products at their own cost.
First Quarter 2024 and Recent Highlights
During the first quarter, Novavax continued executing against
its three key priorities for 2024.
Priority #1: Deliver an Updated COVID-19 Vaccine for the
2024-2025 Vaccination Season
U.S. Market:
- Updated protein-based COVID-19 vaccine to JN.1 with
anticipated pre-filled syringe presentation.
- Completed the submission of the Biologics License Application
for Novavax's COVID-19 vaccine with the U.S. Food and Drug
Administration (FDA).
- Aligned with the FDA on pathway for Emergency Use Authorization
for updated COVID-19 vaccine for the 2024-2025 vaccination season,
with the intent of facilitating product availability at the
beginning of the season.
- Advanced retail pharmacy contract negotiations for the
2024-2025 vaccination season.
Global Markets:
- Delivered doses of Nuvaxovid XBB.1.5 vaccine to
Europe and for distribution by the
Taiwan Centers for Disease Control.
- Received marketing authorization from the United Kingdom's (U.K.) Medicines and
Healthcare products Regulatory Agency for Nuvaxovid XBB.1.5 in
individuals aged 12 and older in January and progressed
preparations for participation in the U.K. spring campaign for
private healthcare providers.
- Granted full approval from Singapore's Health Sciences Authority for
Nuvaxovid XBB.1.5 for active immunization to prevent COVID-19 in
individuals aged 12 and older.
Priority #2: Launch Phase 3 trial of CIC and Stand-alone
Influenza Program
Novavax remained focused on leveraging its technology platform,
including its proprietary Matrix-M adjuvant, to expand its pipeline
with CIC and stand-alone influenza vaccine candidates.
- Made strategic decision to add a stand-alone influenza arm to
the Phase 3 trial and to focus on individuals at higher risk by
enrolling adults aged 60 and older for both the stand-alone
influenza and CIC arms of the trial.
- On track to submit an investigational new drug application and
initiate the pivotal Phase 3 trial for both CIC and stand-alone
influenza vaccine candidates in the second half of 2024, with
potential for accelerated approval and launch in 2026.
- Continued to optimize preclinical candidates, including a new
approach to H5N1 pandemic bird flu vaccination, and expanded core
technology for novel applications including mucosal vaccination and
high-density nanoparticles.
Priority #3: Continue Evolution of Novavax, Further
Reducing Operating Expenses
Novavax has made significant progress on its commitment to
improve its financial position while maintaining the capabilities
that support long-term value creation.
- On track with global restructuring and cost reduction plan,
continued to transform the Company into a more lean and agile
organization, with an approximately 50% reduction in combined
R&D and SG&A expenses in the first quarter of 2024 compared
to 2023.
- Since December 31, 2022, reduced
current liabilities by $1.7 billion,
including an additional $831 million
reduction in the first quarter of 2024, primarily driven by the
settlements with Gavi, the Vaccine Alliance and Fujifilm Diosynth
Biotechnologies.
First Quarter 2024 Financial Results
- Total revenue for the first quarter of 2024 was
$94 million, compared to $81 million in the same period in 2023.
- Cost of sales for the first quarter of 2024 was
$59 million, compared to $34 million in the same period in 2023. These
quarters included $15 million and
$25 million, respectively, related to
excess, obsolete or expired inventory, losses on firm purchase
commitments under third-party supply agreements and unutilized
manufacturing capacity.
- R&D expenses for the first quarter of 2024 were
$93 million, compared to $247 million in the same period in 2023. The
decrease was primarily due to reductions in manufacturing and
clinical research-related spend as well as a $27 million benefit associated with the favorable
settlement of manufacturing liabilities recorded in the first
quarter of 2024.
- SG&A expenses for the first quarter of 2024 were
$87 million, compared to $113 million for the same period in 2023. The
decrease was primarily due to the Company's continued cost
containment measures to reduce operating spend.
- Net loss for the first quarter 2024 was $148 million, compared to a net loss of
$294 million in the same period in
2023.
- Cash, cash equivalents and restricted cash were
$496 million as of March 31, 2023, compared to $584 million as of December 31, 2023.
Financial Framework
Novavax is updating its Full Year 2024 Financial Guidance and
expects to achieve the following objectives:
Full Year 2024 Guidance
$ in
millions
|
Prior
(as of February 28,
2024)
|
Updated
(as of May 10,
2024)
|
Combined Revenue and
Sanofi Agreement Payments
|
$800 -
$1,000
|
$970 -
$1,170
|
Total
Revenue1,2
|
$800 -
$1,000
|
$400 - $600
|
Initial Sanofi Agreement
Payments3
|
|
~$570
|
|
|
|
Combined R&D and
SG&A
|
$700 - $800
|
$700 - $750
|
|
|
1.
|
Total Revenue
includes product sales and royalties and other
revenue.
|
2.
|
Full year 2024
guidance reflects APA expected dose delivery schedules of $150
million to $250 million and non-APA related revenue of $250 million
to $350 million, subject to updated variant manufacturing and
regulatory approvals, from a combination of commercial market
product sales plus royalties and other revenue from partner-related
activity. The update to the expected 2024 APA dose delivery
schedules reflects the anticipated shift of approximately $250
million in contracted doses from 2024 to future
periods.
|
3.
|
Sanofi agreement
initial payments include a non-refundable $500 million upfront
payment to be received within 10 days and an immediate $69 million
equity investment in Novavax.
|
Total potential contract value for APAs outstanding, as of
March 31, 2024, was over $600 million related to expected dose deliveries
for the second quarter of 2024 through 2026. This amount excludes
deferred revenue associated with the 2023 Canada amendments to
forfeit doses.
Novavax is prepared to initiate an additional cost reduction
program to reduce 2025 R&D plus SG&A expenses to below
$500 million, a portion of which it
expects to be reimbursed by Sanofi under the agreement. This
reflects a greater than $225 million
reduction beyond prior stated targets.
Intends to further reshape the size and scope of global business
operations to prioritize enabling Sanofi to successfully
execute its commercial and development plans under the agreement,
deliver on existing Novavax APAs and focus on creating value from
R&D and business development.
Conference Call
Novavax will host its quarterly conference call today at
8:30 a.m. ET. To join the call
without operator assistance, you may register and enter your phone
number at https://emportal.ink/3VNP8J5 to receive an
instant automated call back. You may also dial direct to be entered
to the call by an operator. The dial-in numbers for the conference
call are (888) 664-6383 (Domestic) or (+1) (416) 764-8650
(International). Participants will be prompted to request to join
the Novavax, Inc. call. A replay of the conference call will be
available starting at 11:30 a.m. EST
on May 10, 2024, until 11:59 p.m. ET on May 17,
2024. To access the replay by telephone, dial (888) 390-0541
(Domestic) or (+1) (416) 764-8677 (International) and use passcode
414036 #.
A webcast of the conference call can also be accessed on the
Novavax website at ir.novavax.com/events. A replay of the webcast
will be available on the Novavax website until June 10, 2024.
Trade Name in the U.S.
The trade name Nuvaxovid™ has not been approved by the U.S.
FDA.
About Novavax
Novavax, Inc. (Nasdaq: NVAX) promotes improved health by
discovering, developing and commercializing innovative vaccines to
help protect against serious infectious diseases. Novavax, a global
company based in Gaithersburg,
Md., U.S., offers a differentiated vaccine platform that
combines a recombinant protein approach, innovative nanoparticle
technology and Novavax's patented Matrix-M adjuvant to enhance the
immune response. The Company's portfolio includes its COVID-19
vaccine and its pipeline includes CIC and stand-alone influence
vaccine candidates. In addition, Novavax's adjuvant is included in
the University of Oxford and Serum
Institute of India's R21/Matrix-M
malaria vaccine. Please visit novavax.com and LinkedIn for more
information.
Forward-Looking Statements
Statements herein relating to the future of Novavax, its
mission, its near-term priorities including delivering an updated
COVID-19 vaccine for the start of the 2024-2025 vaccination season
in a pre-filled syringe presentation, launching a Phase 3 trial for
CIC and stand-alone influenza in the second half of 2024, with
possible combination vaccine and stand-alone influenza vaccine
launch in 2026, and reducing operations expenses, including by
initiating an additional cost reduction program, the anticipated
timing of potential BLA approval for Novavax's prototype vaccine
and EUA for Novavax's updated COVID-19 vaccine, potential royalties
and milestones under the agreement with Sanofi, its operating
plans, objectives and prospects, updated full year 2024 financial
guidance, its future financial or business performance, conditions
or strategies, and its ability to attain contract value under
existing APAs are forward-looking statements. Novavax cautions that
these forward-looking statements are subject to numerous risks and
uncertainties that could cause actual results to differ materially
from those expressed or implied by such statements. These risks and
uncertainties include, without limitation, Novavax's and Sanofi's
ability to successfully implement its partnership, including the
ability to transition key processes and effect technology
transfers, Novavax's ability to successfully and timely
manufacture, distribute, or market its updated COVID-19 vaccine
including as a single dose vial or pre-filled syringe product
presentation for the 2024-2025 vaccination season; challenges
satisfying, alone or together with partners, various safety,
efficacy, and product characterization requirements, including
those related to process qualification, assay validation and
stability testing, necessary to satisfy applicable regulatory
authorities; challenges or delays in conducting clinical trials;
challenges or delays in obtaining regulatory authorization for its
product candidates, including its updated COVID-19 vaccine in time
for the 2024-2025 vaccination season or for future COVID-19 variant
strain changes, its CIC and stand-alone influenza vaccine
candidate; manufacturing, distribution or export delays or
challenges; Novavax's substantial dependence on Serum Institute of
India Pvt. Ltd. and Serum Life Sciences Limited for co-formulation
and filling and PCI Pharma Services for finishing Novavax's
COVID-19 vaccine and the impact of any delays or disruptions in
their operations on the delivery of customer orders; difficulty
obtaining scarce raw materials and supplies; resource constraints,
including human capital and manufacturing capacity, constraints on
Novavax's ability to pursue planned regulatory pathways, alone or
with partners, in multiple jurisdictions simultaneously, leading to
staggering of regulatory filings, and potential regulatory actions;
challenges in implementing its global restructuring and cost
reduction plan; Novavax's ability to timely deliver doses;
challenges in obtaining commercial adoption and market acceptance
of its updated COVID-19 vaccine or any COVID-19 variant strain
containing formulation; challenges meeting contractual requirements
under agreements with multiple commercial, governmental, and other
entities, including requirements to deliver doses that may require
Novavax to refund portions of upfront and other payments previously
received or result in reduced future payments pursuant to such
agreements; challenges related to the seasonality of vaccinations
against COVID-19; and those other risk factors identified in the
"Risk Factors" and "Management's Discussion and Analysis of
Financial Condition and Results of Operations" sections of
Novavax's Annual Report on Form 10-K for the year ended
December 31, 2023 as filed with the
Securities and Exchange Commission (SEC). We caution investors not
to place considerable reliance on forward-looking statements
contained in this press release. You are encouraged to read our
filings with the SEC, available at www.sec.gov and
www.novavax.com, for a discussion of these and other risks and
uncertainties. The forward-looking statements in this press release
speak only as of the date of this document, and we undertake no
obligation to update or revise any of the statements. Our business
is subject to substantial risks and uncertainties, including those
referenced above. Investors, potential investors, and others should
give careful consideration to these risks and uncertainties.
NOVAVAX,
INC.
|
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
|
|
|
|
Three Months
Ended
March
31,
|
|
|
2024
|
|
2023
|
|
|
(unaudited)
|
|
|
|
|
|
|
Revenue:
|
|
|
|
|
Product
sales
|
$
82,324
|
|
$
(7,457)
|
|
Grants
|
--
|
|
87,379
|
|
Royalties
and other
|
11,531
|
|
1,029
|
|
Total
revenue
|
93,855
|
|
80,951
|
|
Expenses:
|
|
|
|
|
Cost of
sales
|
59,209
|
|
34,086
|
|
Research
and development
|
92,679
|
|
247,101
|
|
Selling,
general and administrative
|
86,798
|
|
112,532
|
|
Total
expenses
|
238,686
|
|
393,719
|
|
Loss from
operations
|
(144,831)
|
|
(312,768)
|
|
Interest
expense
|
(4,111)
|
|
(4,316)
|
|
Other income
|
3,654
|
|
24,362
|
|
Loss before income
taxes
|
(145,288)
|
|
(292,722)
|
|
Income tax
expense
|
2,262
|
|
1,183
|
|
Net loss
|
$
(147,550)
|
|
$
(293,905)
|
|
Net loss per
share
|
|
|
|
|
Basic and
Diluted
|
$
(1.05)
|
|
$
(3.41)
|
|
Weighted average number
of common shares outstanding
Basic and
Diluted
|
139,916
|
|
86,158
|
|
|
|
|
|
|
SELECTED
CONSOLIDATED BALANCE SHEET DATA
|
(in
thousands)
|
|
|
March
31,
2024
|
|
December
31,
2023
|
|
(unaudited)
|
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
$
480,586
|
|
$
568,505
|
|
Total restricted
cash
|
15,350
|
|
15,305
|
|
Total current
assets
|
727,120
|
|
1,143,888
|
|
Working
capital
|
(77,262)
|
|
(491,250)
|
|
Total assets
|
1,353,534
|
|
1,794,490
|
|
Convertible notes
payable
|
168,432
|
|
168,016
|
|
Total stockholders'
deficit
|
(867,084)
|
|
(716,927)
|
|
|
|
|
|
|
|
Contacts:
Investors
Erika Schultz
240-268-2022
ir@novavax.com
Media
Giovanna Chandler
202-709-5563
media@novavax.com
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SOURCE Novavax, Inc.