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Novavax struggled to market its Covid-19 shot in the US
Jeroen Jumelet/ANP/AFP via Getty Images
whom
Modern
and
Pfizer
With mRNA-based Covid-19 vaccines poised to hit the commercial market this year, one big wild card remains: what
Novavax
Will an alternative covid-19 vaccine be paid for?
Modern
(ticker: MRNA) and
Pfizer
(PFE) have both negotiated higher-than-expected commercial prices for their shots, with figures so far nearly five times higher than they charged the federal government last summer.
Novavax
( NVAX ), so far mum, presents an interesting opportunity for investors looking to see how the market will evolve: What if Novavax prices its vaccine dramatically below its competitors?
“The big guys are setting the price points at this point,” Novavax Chief Commercial Officer John Trizzino said in an interview this week on the sidelines of the JP Morgan Healthcare conference, a major investor event in San Francisco. “We will not reveal what our pricing strategy is yet. It is a lever that we will use to our advantage based on a number of other factors.”
Novavax (NVAX) has been a disappointing entry in the Covid-19 vaccine market so far. Despite promising clinical data, the company has struggled to market its vaccine in the US, missing out on the initial flood of sales of the Covid-19 vaccine to governments worldwide.
To date, just over 70,000 doses of his vaccine have been administered in the United States. Investors have lost heart, sending Novavax shares down almost 90% over the past 12 months. The stock closed at $11.80 on Thursday, down more than $200 a share in early 2021.
Novavax this week announced the retirement of longtime CEO Stanley Erck and the selection of industry veteran John C. Jacobs as his replacement. Jacobs will start at the end of this month.
Trizzino said this year presents “an opportunity for the organization to hit the reset button a little bit as far as what the public opinion is.” Barron’s. “We think we have a very safe, very effective vaccine that will be part of the picture that’s needed.”
Moderna and unlike
Pfizer
,
Novavax’s shot is a traditional protein-based vaccine. The company is also combining flu and Covid-19 vaccines in Phase 2 trials that began last month.
Pfizer has not disclosed the commercial price of the Covid-19 vaccine, but an executive told investors in October that the company was considering a list price of between $110 and $130 per adult dose. Moderna CEO Stephane Bancel suggested to The Wall Street Journal on Monday that the company is considering a price in the same range.
“I think Pfizer and Moderna have done us a favor by coming forward with some pricing strategies,” Novavax’s Trizzino said.
Trizzino says Novavax is already in discussions with buyers such as pharmacy chains. “Our ability to go to the right medical facility as opposed to depending on the U.S. government to buy in will help,” says Trizzino. “And maybe a little adjustment to the pricing strategy. Therefore, we will see what will happen.”
Trizzino says Novavax thinks it can capture 30% of what it expects to be a $10 billion annual market for Covid-19 vaccines in high-income countries. Analyst estimates are slightly smaller: The FactSet consensus forecast pegs sales of Novavax’s Covid-19 vaccine at $849 million in 2023 and $1.9 billion in 2024.
The future of the vaccine likely depends on US health authorities taking a more positive view of the shot. For now, the Food and Drug Administration approves the Novavax vaccine as a first booster for those who cannot or will not receive the mRNA-based vaccine, and the Centers for Disease Control and Prevention has similar language. While it is the FDA’s role to approve a vaccine for sale in the United States, CDC recommendations determine how it should be used.
Novavax, unlike Pfizer and Moderna, has yet to update its vaccine to target the latest circulating strains of the virus. “Until BA.5, our immune responses were stable,” said Filip Dubovsky, chief medical officer of Novavax. “I can tell you right now that this XBB, XBB.1, looks different to us,” he said, referring to the variant family that has been of particular concern in recent weeks.
According to Dubovsky, Novavax has begun producing the so-called viral seed needed to start the manufacturing process for an updated version of its vaccine that will target XBB.1.1.5. This is a sub-variant that has recently become dominant in much of the United States and is raising alarm bells around the world. The company will present data on the XBB virus family at a CDC advisory committee hearing later this month, Dubowski said.
“What we’re going to bring to the market is what the health authorities are asking for,” Dubowski said.
Email Josh Nathan-Kazis at josh.nathan-kazis@barrons.com