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Novavax' Shares Drop as FDA Advises Another Study for Resvax

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Shares of Novavax, Inc. (NVAX - Free Report) declined about 12% after the FDA recommended the company to conduct an additional phase III study for its respiratory syncytial virus (RSV) vaccine candidate for infants, ResVax.

ResVaxis being developed to protect infants by immunizing mothers against the disease, the leading viral cause of severe lower respiratory tract disease in infants and young children. 

The FDA has recommended the additional   to confirm efficacy against medically significant RSV disease in infants born to mothers vaccinated with ResVax. In February 2019, the company announced that the phase III PREPARE study on ResVax did not meet the primary endpoint of prevention from medically significant RSV and lower respiratory tract infection (LTRI).

However, the study did show efficacy against a secondary objective of preventing hospitalization, and is the first RSV vaccine to show phase III efficacy. This news led to the crashing of shares by more than 65% back then.However, Shares of Novavax have decreased 85.6% year to date against the industry’s increase of 1.9%.

 

Novavax has met with several European national regulatory agencies to get some inputs on the PREPARE study and also to find possible pathways to get marketing approval in Europe.

The development of ResVax was funded by a grants from Bill & Melinda Gates Foundation, to introduce ResVax to low and middle income countries.

Novavax has another vaccine candidate in its pipeline, influenza vaccine Nanoflu and is planning to initiate a phase III study on Nanoflu, following the successful completion of a phase II study earlier in January.

 

Zacks Rank and Stocks to Consider

Novavax has a Zacks Rank #2 (Buy).

Some better-ranked stocks in the biotech sector are Anika Therapeutics Inc. (ANIK - Free Report) , Applied Genetics Technologies Corp. and Acorda Therapeutics Inc. . All of them carry a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Anika’s earnings per share estimates have moved up from $1.22 to $1.28 for 2019 and from $1.21 to $1.33 for 2020 in the past 60 days. The company delivered a positive earnings surprise in the trailing four quarters, with average beat of 72.00%.         

Applied Genetics’ loss per share estimates have narrowed from $1.25 to 1 cent for 2019 and from $2.39 to $2.15 for 2020 in the past 60 days. The company delivered a positive earnings surprise in three of the trailing four quarters, with average beat of 83.47%.    

Acorda’s loss per share estimates have narrowed from $3.84 to $3.59 for 2019 and from $3.32 to $3.09 for 2020 in the past 60 days. The company delivered a positive earnings surprise in all of the trailing four quarters, with average beat of 79.32%.    

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