Novavax stock price has rocketed up 21 percent after H.C. Wainwright analyst Vernon Bernardino raised his price target from $10 to $17.

Mr. Bernardino likes the agreement on a Phase 3 trial design for NanoFlu that Novavax announced with the FDA on August 5, 2019, which sets the stage for the program to accelerate. The analyst believes Novavax’s NanoFlu vaccine can now be approved in 2022 versus his prior expectation of 2024. He looks for share price appreciation to allow “successful financings” in 2020 and 2021, positioning Novavax to independently launch commercial NanoFlu worldwide.

I’m not a big fan of a company like Novavax diluting share holder value by issuing stock in order to finance a product launch in 2020 or 2021. I would rather invest in the stock after the dilution takes place. If Novavax is going to dilute shares with a stock offering, they should just do it now instead of waiting for the stock to pop after a firm like H.C. Wainwright pumps it IMO.

Novavax recently announced new data from the company’s Prepare trial, a global Phase 3 clinical trial of ResVaxan aluminum adjuvanted respiratory syncytial virus fusion protein recombinant nanoparticle vaccine. The recently completed analyses of the 1-year safety data, including a 59.6% reduction in the incidence of serious adverse events diagnosed as pneumonia, with confirmation by chest x-ray, that extended through the first year of life. A similar efficacy of approximately 50% was found for all SAEs with a clinical diagnosis of pneumonia, also extending over a year. When x-ray-confirmed pneumonia SAEs associated with detection of RSV were considered, efficacy was 72.9% through 180 days of life, the last time point at which active detection of RSV was carried out.

ResVax is an RSV fusion (F) protein recombinant nanoparticle vaccine with aluminum phosphate as an adjuvant. It is being developed to protect infants from RSV disease via maternal immunization, which may offer the best method of protection from RSV disease in infants through the first months of life. In February 2019, Novavax announced top-line data from Prepare™, a global Phase 3 clinical trial in 4,636 pregnant women, at least 3,000 of whom have received the vaccine, and their infants. Prepare is supported by an $89.1 million grant from the Bill & Melinda Gates Foundation (BMGF).

NVAX stock had huge buy side volume on August 14, 2019, after the HC Wainwright price target was raised to $10 per share

Back on February 28, 2019, Novavax stock plunged -67% in a single day after the company reported poor results from the phase 3 clinical trial of its ResVax vaccine for respiratory syncytial virus, saying that the vaccine failed to meet the primary objective of preventing medically significant lower respiratory tract infection as a result of the disease. Novavax CEO Stanley Erck did damage control by noting that “while this study did not meet the pre-specified success criterion for the primary clinical endpoint of this trial, the data indicate that ResVax protects infants from some of the most serious consequences of RSV,” including respiratory tract infection hospitalizations and cases involving sever hypoxemia. Shareholders weren’t buying it and they sold because they thought the poor phase 3 results could make ResVax a non-starter for future sales.

Disclosure: I do not hold any position in Novavax stock.

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