Novavax Granted HHS Contract for VLP Vaccine (NVAX)
Piper Jaffray released a report today on the much-improved 2011 financial position of Novavax (NASDAQ: NVAX). The improvement is partially attributed to the grant of a new flu vaccine contract to Novavax from the Department of Health and Human Services (HHS). The contract was awarded for the company's Virus-Like Particle (VLP) vaccine and is for $97 million in committed funding for the first 3 years, plus a 2-year option period valued at $82 million, the report states.
The $97 million will fund 5 clinical trials for the VLP vaccine, to be completed by YE11. Novavax is reported to submit plans for a new pandemic vaccine factory by YE11. Analysts note that earlier this month the VLP vaccine was licensed by NVAX to LG Life Sciences in South Korea for undisclosed upfront and milestone payments, plus royalties.
Piper analysts give NVAX an Overweight rating with a price target of $4.00. Risks include the potential for VLP vaccines to fail in the clinic or to get regulatory approval, in addition to a potential lack of funding from BARDA, the HHS department which awarded the contract. NVAX is currently trading at $2.54.
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.