NVAX shares continue steady advance

Shares of Novavax, a virus-like particle (VLP) vaccine manufacturer, continued its steady climb today amid continuing concerns about the mutation influenza strains. FDA approval is several years away, but NVAX's novel approach to manufacturing recombinant vaccines has given them contracts to work with the National Institute of Health (NIH) and commercial commitments in India (with parrtner Cadila) and Spain (with partner Rovi).

http://www.scienceprogress.org/2009/08/influenza-vaccine/

NVAX's VLP manufacturing platform accelerates vaccine production, reducing ramp up time from 6 - 8 months to 4 weeks. Facilities cost are also reduced by 90%. Yields are increased due to elimination of egg-based manufacturing process used by traditional vaccine makers. Most importantly, the VLP process could potentially enable the production of a "super vaccine", which provides immunogenicity for all mutated strains of influenza.

Disclosure: I am long NVAX shares.

NVAX and SVA swine flu vaccines are effective

Shares of NVAX and SVA rose approximately 10% this morning on positive results of their respective swine flu vaccines. NVAX's VLP vaccine immunized ferrets from the flu, while the SVA egg-based vaccine displayed immunogenicity among humans.

http://www.reuters.com/article/marketsNews/idINN1834168720090818?rpc=44

NVAX has multiple partnership agreements with India's Cadila and Spain's Rovi to manufacture the VLP vaccine for Asian, European, and Latin American countries. NVAX is also working with the NIH and FDA in clinical-stage trials in the US.

SVA has an order for a minimum of 10 million doses to cover Beijing, but will likely garner additional orders for domestic Chinese provinces as well as other Asian countries, including a distribution deal for the Philippines.

BCRX and NVAX receive positive news

Leerink Swann, an investment bank specializing in biotech and life science companies, upgraded their price target on BCRX from $5 to $10, on an estimated Emergency Use Authorization order of $394 million for US stockpiling of the anti-viral Peramivir. The report was curious in the exact amount of $394, as the specificity could be a telegraph that an order is imminent. In any case, longs have been anticipating EUA for weeks, so the waiting game continues, as longs and shorts battle for positioning.

NVAX received good news this morning, according to an article in Indian Times. Cadila, a NVAX partner for their vaccine-like particle (VLP) flu vaccine, announced they are the first pharma company to produce a vaccine for the novel H1N1 virus in India. NVAX, in addition to receiving milestone payments, will receive 20% royalties on sales of the vaccine in India, meaning revenue from the Cadila partnership will go directly to NVAX's bottom line, as Cadila picks up all clinical development costs. Approval is expected by the end of this year. See previous blogs for NVAX value proposition and our investment thesis, mainly higher vaccine yields, faster vaccine production, and lower in-border manufacturing costs. All of these benefits are due to not needing eggs to produce the VLP vaccine. Under- and un-developed countries will greatly benefit due to faster ramp and lower cost structure, as well as the ability to control domestic manufacturing capacity. They won't be held hostage to foreign healthcare resources.

In fact, in a bit of irony, with India fast-tracking NVAX's VLP vaccine, the US may be on the outside looking in if vaccine production falls short. That would be a travesty considering NVAX is a US supplier of vaccines. This is another shameful example of the FDA dragging their feet, partly due to insidious pressure from incumbent big pharmaceutical companies to impede progress of promising competitive solutions from innovative upstarts like NVAX.