The US Food and Drug Administration (FDA) recently approved Novartis’ ( NVS - Snapshot Report ) influenza virus vaccine, Flucelvax. Flucelvax is the first cell-culture-derived vaccine, for patients 18 years of age and older.

The US approval of Flucelvax was based on positive results which showed that Flucelvax was well tolerated compared to placebo.

Cell-culture technology is used to manufacture other vaccines such as polio, rubella and hepatitis A. Flucelvax does not have any preservatives like thimerosal or antibiotics.

We note that Novartis has a partnership agreement with the US Department of Health and Human Services, Biomedical Advanced Research and Development Authority (HHS, BARDA) to develop cell-culture manufacturing technology. The agreement also includes the construction of a state-of-the-art facility in Holly Springs.

HHS awarded more than $1 billion for the development of the technology in the US. Once the Holly Springs facility is ready for commercial production, Flucelvax will be manufactured there.

We remind investors that Novartis’ Vaccines and Diagnostics segment was recently in the news as the Italian Medicines Agency (AIFA) lifted the temporary halt on the company’s seasonal influenza vaccines Agrippal and Fluad. Similar bans were lifted in Canada, Switzerland and Singapore as well.

The Vaccines and Diagnostics segment also received encouraging news as the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) recently gave a positive opinion on Novartis’ meningococcal group B (MenB) vaccine Bexsero. We however note that companies like Pfizer Inc. ( PFE - Analyst Report ) are looking to enter the MenB vaccine market.

We are encouraged by Novartis’ performance in the Vaccines and Diagnostics segment in the recent past. Currently, we have a Neutral recommendation on Novartis. Novartis carries a Zacks #3 Rank (Hold rating) in the short run.