JPMorgan Turns Bullish On Novavax After Phase 1 Coronavirus Vaccine Readout

Novavax, Inc. NVAX announced positive results from the Phase 1 portion of the Phase 1/2 trial of its coronavirus vaccine candidate, and it appears best-in-class, JPMorgan said in a Wednesday upgrade.

The Novavax Analyst: Eric Joseph upgraded shares of Novavax from Neutral to Overweight and increased the price target from $105 to $275.

Takeaways From Novavax's Phase 1 Data: The neutralizing antibody activity of Novavax's  NVX-CoV2373 looks best-in-class, and the tolerability profiles of both the 5mcg and 25mcg two-dose regimens were comfortably within the bounds of licensure-eligible candidates, Joseph said in the upgrade note. (See his track record here.)

The neutralizing antibody activity reported by Novavax was based on 100% neutralization of CoV2 compared to 50% virus neutralization with most of the competitive datasets so far, the analyst said.

The human convalescent sera samples used in Novavax's Phase 1 dataset have a comparatively higher bar given the fact they were drawn predominantly from moderate-to-severe COVID-19 patients, he said. 

"Flatly, we are pleasantly impressed by the initial immunogenicity/safety profile for NVX-CoV2373 in the phase 1 vaccine results announced last night."

NVX-CoV2373 demonstrated a generally well-tolerated safety profile, with the vast majority of reactogenecity events being reported as mild, Joseph said.

More importantly, no serious adverse events were reported in any treatment groups. 

"All told, we see currently available NVX-CoV2373 safety as generally in-line with competitor phase 1/2 datasets generated to date." 

Novavax's Way Forward: Following the review of the Phase 1 data by the FDA, a planned Phase 2 study will evaluate the vaccine in a 1,500-participant study in the U.S. and Australia, according to JPMorgan.

This will include an older/higher-risk population, as opposed to the Phase 1 study, which evaluated patients ages 18-59, Joseph said. 

The Phase 3 global efficacy studies could commence as early as the end of September following an interim Phase 2 readout, the analyst said.

NVX-CoV2373 is looking "every bit the contender" in Phase 1, and relative valuations favor Novavax in the near-term ahead of the first of the competitor Phase 3 vaccine efficacy readouts, he said. 

NVAX Price Action: At last check, Novavax shares were rallying 8.03% to $169.79. 

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Posted In: CoronavirusCovid-19Eric JosephJPMorganAnalyst ColorBiotechUpgradesHealth CarePrice TargetAnalyst RatingsMoversTrading IdeasGeneral