After years of missteps in developing and commercializing its coronavirus shot, Novavax is turning to one of the biopharma industry’s most experienced vaccine companies to help salvage its COVID efforts: Sanofi.
The French Big Pharma will partner with the struggling Maryland biotech to co-commercialize its COVID-19 jab Nuvaxovid and develop combination vaccines.
In all, Novavax will receive $500 million up front, plus up to $700 million in potential development, regulatory and launch milestones plus tiered royalties. As part of the arrangement, Sanofi is taking a 4.9% equity position in Novavax.
Sanofi will book sales for Nuvaxovid at the start of next year. The French company’s vaccine legacy includes developing, manufacturing and commercializing shots worldwide to protect against polio, rabies, meningitis and the flu.
The partnership allows Novavax to lift its “going concern” notice from February when it warned investors that the plunging demand for COVID vaccines could send the company into bankruptcy. It also relieves Novavax from pressure from activist investor Shah Capital, which called the company “historically mismanaged,” in a public letter last month.
With the announcement, Novavax’s share price increased by 121% to $9.89—still far from the $289 price Novavax’s shares attracted in February 2021 when the company was hailed as a rags-to-riches story after scoring a $1.6 billion government grant to develop its COVID shot.
During a Friday conference call, Novavax CEO John Jacobs called the deal “the beginning of a new chapter for the future of our company.”
“I’d rather not comment on what Sanofi may be thinking or why they came to the conclusion why this is such an exciting platform to partner with, but we’re not surprised because we know the value our technology can offer,” Jacobs added.
The agreement gives more people around the world access to Nuvaxovid, a traditional, protein-based adjuvanted vaccine, which differs from the mRNA-type shots manufactured by Moderna and Pfizer and its German partner BioNTech.
In exchange, Sanofi receives access to Novavax’s Matrix-M adjuvant technology. Novavax can receive up to $200 million plus tiered royalties for each Sanofi vaccine product developed using the platform.
Novavax will retain the rights to a combination COVID/flu vaccine that's under development, while Sanofi gains the ability to use Nuvaxovid in developing non-influenza combination vaccines.
“We have an opportunity to develop non-mRNA flu-COVID-19 combination vaccines, offering patients both enhanced convenience and protection against two serious respiratory viruses,” Jean-Francois Toussaint, Sanofi’s head of vaccines R&D, said in a release. “We're excited by the prospect of combining Novavax's adjuvanted COVID-19 vaccine that has shown high efficacy and favorable tolerability with our rich portfolio of differentiated flu vaccines.”
Novavax’s urgency to make a deal was highlighted on Friday as the company presented its quarterly financial report, slashing its guidance for annual sales from a range of $800 million to $1 billion to a window of $400 million to $600 million. The company achieved revenue of $2 billion in 2022 and $984 million in 2023.
This comes as AstraZeneca is pulling its non-mRNA COVID vaccine from markets around the world. This week the EMA said it had accepted a request from AZ and withdrawn the company’s European marketing authorization for its pandemic shot Vaxzevria.
“As multiple, variant COVID-19 vaccines have since been developed there is a surplus of available updated vaccines,” the company said. “This has led to a decline in demand for Vaxzervria, which is no longer being manufactured or supplied.”