Novavax: novel vaccine proves effective against swine flu, lifting earnings

Novavax (NVAX) shares soared some 10 percent today after the small clinical-stage biotechnology company announced positive preclinical results for its new vaccine H1N1 influenza, or swine flu.

Novovax, based in Rockville, Maryland, developed the vaccine using proprietary virus-like particle (VLP) technology. As the name suggests, the scientists develop a virus-like particle but without the genetic material that it needs to reproduce. These particles are injected as non-infectious decoys. They attach to immune cells, which mistake the particles for viruses and spark a strong immune response, the company explains. Unlike a standard influenza vaccine, which uses a weakened or dead flu virus to stimulate the immune system, the Novavax decoy cannot replicate or infect cells.
The study was conducted in a collaborative agreement between Novavax and the Centers for Disease Control. Trials showed that within five days, even a low dose of the vaccine protected ferrets against swine flu, Novavax reported.

Novavax says its speed in producing the candidate vaccine and delivering it to the CDC -- less than four weeks since it received the 2009 H1N1 virus strain -- shows how well it can respond to an outbreak. Producing its vaccine does not depend on growing influenza virus in chicken eggs, as is the industry standard, or the development of virus seed stocks, which can take months.

The company will start testing its vaccine on humans in the U.S. in the fourth quarter, CEO Rahul Singhvi told Bloomberg News. But despite an anticipated shortage of the H1N1 vaccine -- 45 million doses, instead of the 120 million called for -- the Novavax vaccine would take at least a couple years for approval, while several companies making the virus the old-fashioned way are already in the midst of clinical trials.

Dutch biotech company Crucell (CRXL) slumped by more than two percent, despite scoring a $40.7 million order from the National Institute of Allergy and Infectious Diseases and the National Institutes of Health. Crucell was contracted to develop monoclonal antibodies for treating influenza. The contract has additional options worth a further $28.4 million, bringing the potential total to $69.1 million.

Crucell has developed a set of unique human monoclonal antibodies that have been shown to protect against a wide range of distinct seasonal and pandemic influenza viruses, including strains that have become resistant to the anti-viral drug Tamiflu, the company said. Crucell says the contract with the U.S. confirms the validity of its antibody approach.

So far, it seems, vaccine makers are conducting more research and clinical trials than producing actual vaccines. If the H1N1 pandemic gets worse, as many predict it will this winter, more needs to be done.

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