Novavax Terminated (Novavax Stock) Its Production Agreement With Fujifilm And Settled For $185 Million Due To Weak Vaccine Demand

Novavax Stock

After receiving approval from the FDA earlier this summer, Novavax’s (Novavax Stock)  COVID-19 vaccine has been met with a demand that is far lower than the company had anticipated. At this time, the corporation is making a settlement payment to a manufacturing partner in order to get out of a supply arrangement.

In a statement with the Securities and Exchange Commission, Novavax stated that it would pay Fujifilm Diosynth Biotechnologies a settlement fee of up to $185 million about the “termination of manufacturing activities” that occurred at its CDMO partner. According to the statement made by Novavax, the whole amount will be paid in four equal quarterly payments of $34.3 million beginning on March 31, 2023.

However, there is no assurance that the settlement will reach that figure. As part of the agreement, Fujifilm’s subsidiary will be compelled to “make commercially reasonable efforts” to locate manufacturing contracts to compensate for the losses it would experience due to vacant capacity. It is possible that whatever work Fujifilm Diosynth Biotechnologies is able to secure will wind up offsetting the final two quarterly payments that Novavax is obligated to provide.

Novavax stock: buy or sell

After a number of setbacks, Novavax was granted a license to market its COVID-19 vaccine in the United States in July of this year. However, uptake has been poor, with just 32,992 doses provided so far out of around 841,000 doses delivered, according to statistics from the CDC.

The effectiveness of the vaccination in preventing mild, moderate, or severe cases of Covid was almost 90% on average. Its preventive efficacy was around 78 percent in persons aged 65 and older. Pain or discomfort at the injection site was the most prevalent adverse reaction, followed by weariness, headache, muscle pain, joint pain, nausea and vomiting, and fever.

The Composite Rating for Novavax stock (NASDAQ:NVAX) is 12 out of a possible 99, which is not very good. The Composite Rating assigns a value between one and ninety-nine points to each of a stock’s fundamental and technical growth measures. According to this metric, the NVAX stock is ranked higher than 12 percent of all other stocks.

As a point of reference, there have been more than 230 million doses of Moderna prescribed in the United States. Pfizer estimates that their number is somewhere around 370 million.

The Novavax offer to purchase a piece of the COVID vaccination market is not yet successful in Europe.

In July 2020, Novavax used a portion of the $1.6 billion grant it received from the Trump administration’s Operation Warp Speed to procure trial supplies, which is when Fujifilm Diosynth Biotechnologies became Novavax’s business partner.

At various points, the vaccine that Novavax developed was being discussed as a possible replacement for the mRNA injections that were now dominating the market. However, due to a series of setbacks, the firm has been unable to achieve a significant portion of the market in the United States.

 

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About the author: Valerie Ablang is a freelance writer with a background in scientific research and an interest in stock market analysis. She previously worked as an article writer for various industrial niches. Aside from being a writer, she is also a professional chemist, wife, and mother to her son. She loves to spend her free time watching movies and learning creative design.