Where Will Novavax Be in 5 Years?

Many people wish they could forget this year, but not Novavax (NASDAQ: NVAX). It reported great news for its flu vaccine candidate NanoFlu earlier in 2020. Novavax has also emerged as the biggest coronavirus vaccine winner so far, at least in stock performance. 



diagram: Where Will Novavax Be in 5 Years?


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Where Will Novavax Be in 5 Years?

The future seems bright for Novavax. But where will the biotech be in five years? Here’s how it might look in 2025.



diagram: Timeline of years with a green pushpin next to 2025.


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Timeline of years with a green pushpin next to 2025.

Multiple wild cards

Let me first acknowledge that multiple wild cards could impact Novavax’s fortunes over the next five years.

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Most importantly, the company’s COVID-19 vaccine candidate NVX-CoV2373 could run into problems in late-stage clinical testing. Two much larger drugmakers, AstraZeneca and Johnson & Johnson, have already temporarily paused late-stage studies for their experimental coronavirus vaccines due to potential safety concerns. If NVX-CoV2373 causes severe side effects, that could derail the vaccine’s chances of winning emergency use authorization from the Food and Drug Administration. 

There’s also a possibility, albeit a lower one, that NanoFlu could fail to secure regulatory approval. Novavax plans to move forward with a lot consistency trial so it can file for FDA approval of the flu vaccine candidate. While the odds of winning approval seem good, success is not guaranteed.

The news doesn’t have to be dire for either NVX-CoV2373 or NanoFlu to dramatically alter Novavax’s fortunes. Both vaccines could sail through the regulatory approval process, yet still fail to achieve commercial success if other rivals prove to be even better.

Don’t rule out the potential for a positive wild card, either. There’s an outside chance that a big drugmaker could decide to acquire Novavax by 2025. 

Best-guess scenario

I’ve come up with my best-guess scenario for how the next five years will go for Novavax. First, most of the large drugmakers with vaccine programs already have their own COVID-19 candidates in clinical testing. My hunch at this point is that Novavax won’t be gobbled up by a bigger player.

I’m cautiously optimistic about the prospects for NVX-CoV2373. Sure, the COVID-19 vaccine candidate could flop in late-stage testing. However, I predict that it will prove both safe and effective in protecting against novel coronavirus infection. I think Novavax will win EUA in the first half of 2021 and make a boatload of money over the next couple of years from the vaccine.

As for NanoFlu, my view is that it won’t run into any problems with regulatory approval. By 2025, I think the flu vaccine will be a solid commercial success for Novavax, generating sales topping $1 billion.

Now for an interesting twist: I think we’ll see a couple of waves of new COVID-19 vaccines hit the market after a first wave that includes NVX-CoV2373. I anticipate that these later vaccines will be better than the original ones. Ordinarily, that would likely mean that Novavax’s coronavirus vaccine sales would decline.

However,