Why Novavax Stock Is Losing Ground

Shares of coronavirus vaccine developer Novavax, Inc. NVAX were moving sharply to the downside on above-average volume Monday.

The move comes despite the company announcing that it has added an additional arm in its ongoing Phase 3 COVID-19 vaccine study to evaluate the safety and efficacy of the vaccine in adolescents ages 12-17. 

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The sell-off could be driven by the lack of an update from the company on the outcome of the late-stage study of its vaccine candidate NVX-CoV2373 that's underway in the U.S. and Mexico.

Novavax released in early March final data from the U.K. leg of the trial that confirmed 96% efficacy against the original strain. After a delayed start of the Phase 3 study in the U.S. and Mexico in late December, the company announced completion of enrollment on Feb. 22.

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Apart from licensing deals and initiation of rolling reviews in the U.S., Europe, U.K. and Canada, the company has not announced any update on the late-stage study in the U.S. and Mexico, which may be needed for the FDA to make a call on the vaccine candidate.

With three vaccines already approved for emergency use in the U.S. and a few more outside of the U.S., a potential delay in the rollout of Novavax's vaccine candidate puts the company at a disadvantage. This poses a threat to the valuation of the shares, which looks now stretched.

Further update may be forthcoming when the company releases its first-quarter earnings report May 10.

CEO Gregory Glenn is scheduled to present at the 21st annual World Vaccine Congress taking place online this week.

NVAX Price Action: Novavax shares lost 17.65% Monday, closing at $195.12. 

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