Novavax Investors Can Finally Breathe a Sigh of Relief

Novavax (NVAX) investors faced their fair share of volatility last year with the company's multiple EUA filing delays. In this clip from "The Pharma & Biotech Show" on Motley Fool Live, recorded on Feb. 2, Motley Fool contributors Brian Orelli and Keith Speights discuss and speculate what next steps might look like in terms of an FDA emergency use timeline for Novavax's vaccine.

Brian Orelli: Moderna (MRNA 0.66%) gained full approval for Spikevax, its mRNA vaccine, that's the brand name for it. Novavax completed the final steps to ask for an emergency use authorization application. As far as I can tell, that's basically just sending a note to the FDA saying we want you to review it as an emergency use application. The setup is that you had to submit everything and then you had to wait a month, I guess, for them to start reviewing it and then you could submit the request to review it as an emergency use authorization. As best I can tell, that was basically just Novavax just telling the FDA that they were going to do it and a month ago they said that's what they were going to do. They did that pretty well, pretty much as they were expecting. I think there's probably two issues here in trying to decide which one is more important. For Moderna, they needed this full approval to be able to sell the drug post-pandemic. I don't know when we're going to get to the point where we're post-pandemic. But anything that has an emergency use authorization, if there is no emergency, those are no longer valid and you can't sell your treatment or your test or your vaccine. This was definitely needed but it was probably pretty much expected. Pfizer (PFE 1.19%) got its full approval quite a while ago. I don't know that it really affects Moderna's sales in any material way. The Novavax decision, if positive, if they get an emergency use authorization will affect the company definitely more directly because it will get paid under its contract with the U.S. government. If it doesn't get emergency use authorization, it obviously can't sell it to the U.S. government and it won't get paid. I think the fact that they were applying for emergency use authorization probably isn't that big of a deal because it was largely expected, but the share price did go up so maybe there were some people thinking that this was a gating event, but I don't really see it. I don't think that it hints that the FDA is more likely to issue an emergency use authorization because Novavax sent in the letter. What do you think?

Keith Speights: I don't think so. I understand why investors were glad. Novavax had multiple delays last year in its EUA filing. It's a big milestone for the company for sure to say, hey, we said we were going to do it this time, and we've done it. I think investors were just more than anything breathing a big sigh of relief.

Orelli: Yeah. I think at this point the big question for Novavax investors and, I'm a shareholder, is how long is it going to take to issue an emergency use authorization. They did a rolling submission and so the FDA has presumably had the efficacy data for a while. You would think that might be harder to review than the manufacturing data but whether they've actually been reviewing it over this time, who knows if they were worried that the manufacturing data might never come in? Maybe they didn't bother spending the time reviewing the efficacy data. We have to wait and see how long this might take. Then, the other question is, are they in a hurry? Obviously, with Moderna and Pfizer's vaccines, they put a priority on getting the emergency use authorizations done as quickly as possible after they submitted because we needed to get the shots in arms. But right now, I don't think we are supply constrained at all in the U.S. and so having the extra Novavax vaccine is probably not really going to result in that much additional vaccinations in the United States. I think there are probably some people who are waiting specifically for the Novavax vaccine for various reasons. But I think it's a small number and I'm not sure that the FDA is going to rush just for those few people.

Speights: I agree with you. I think that's the big question, is how long will the FDA take here? I definitely agree with you that there are some Americans who have held out on getting vaccinated because they see Novavax's vaccine as more traditional. It's not a DNA or messenger RNA vaccine. It's protein sub-unit vaccine. I actually know one person myself who isn't anti-vax, but he looked into everything and he just really wanted to get the Novavax vaccine. He's held out all this time, which I didn't think was a great idea, but hopefully, the authorization won't take too long. But Brian, I do suspect though that the U.S. might end up donating a lot of these doses that it gets from Novavax to other countries.

Orelli: Yeah, most definitely. I think that it's likely a majority of the vaccine will get donated for sure.

Speights: To me, that's a big question is what percentage of the doses will be reserved for the U.S. versus giving to low to middle income countries?