Novavax: All Eyes on Upcoming FDA Advisory Meeting

It’s difficult for most stocks to make any headway in 2022. Inflation, rising interest rates and Russia’s ongoing war on Ukraine have dragged down even those with minimal exposure to the macro headwinds.

For Novavax (NVAX), these worries have been amplified by other considerations. First, there is the prospect of dwindling global demand for Covid-19 vaccines, what with the virus on the backfoot in many parts of the world and there being an oversupply in selected regions. Secondly, in the U.S. at least, the company has yet to get its vaccine NVX-CoV2373 across the finish line.

The result has been a stock which has shed ~75% over the past 6 months.

However, on June 7, the FDA's Vaccines and Related Biological Products Advisory Committee (VRBPAC) will meet to discuss Novavax’s EUA application for use of NVX-CoV2373 as a primary vaccine for adults. Recall, last December, the vaccine was approved for use in adults in the EU.

B. Riley’s Mayank Mamtani is confident the meeting will yield a positive outcome, which could act as a catalyst to push shares higher.

“Overall, we anticipate the review to mirror the progress NVAX has had in E.U., including with the ongoing expedited review of the two EUA applications recently submitted in adolescents and use as a booster,” the analyst opined.

Mamtani also points to the European Commission’s (EC) recent APA termination notice to Valneva as an indication that major regulatory and policy stakeholders around the world regard Novavax’ offering as the “only preferred alternative to mRNAs.”

So far, in all previous global regulatory approvals in other regions, there has been “minimal to no debate” on the highly effective and safe credentials of the vaccine as shown in the 3 large-scale Phase 3 studies. And going by previous examples of such EUA FDA panels, following a positive vote by VRBPAC panelists, Mamtani expects a “prompt FDA approval.”

Accordingly, Mamtani reiterated a Buy rating on NVAX shares, backed by a $181 price target. Investors stand to take home about 227% gain, should the target be met over the next 12 months. (To watch Mamtani’s track record, click here)

Turning now to the rest of the Street, where the average target is not quite as high, yet at $135, still makes room for one-year gains of 144%. Overall, the stock claims a Moderate Buy consensus rating, based on 5 Buys, 2 Holds and 1 Sell. (See Novavax stock forecast on TipRanks)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
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