Jfor much of 2021, Novavax (NASDAQ: NVAX) had only itself to blame for the delays in getting approvals and clearances for its COVID-19 NVX-CoV2373 vaccine. The company’s manufacturing problems caused it to repeatedly postpone its plans to file for permits.
However, the U.S. Food and Drug Administration (FDA) is now responsible for what appears to be a reckless pace in deciding whether to grant an Emergency Use Authorization (EUA) for NVX. -CoV2373. Is the FDA slow-walk clearance for Novavax’s COVID-19 vaccine?
If he quacks like a duck…
Pfizer and BioNTech requested the US EUA for their COVID-19 vaccine on Nov. 20, 2020. The FDA cleared the vaccine on Dec. 11 — just over three weeks later. The agency granted EUA to Modern‘s vaccine on December 19, 2020, less than three weeks after Moderna filed.
Novavax submitted its EUA application in the United States on January 31, 2022. It has been seven weeks, but the FDA has yet to issue its decision.
This mismatch prompted Georgetown law professor Lawrence Gostin, who specializes in public health law, to tweet on March 11, 2022, “FDA must stop allowing slow walking #Novavax. All the major regulators have allowed it.”
Gostin wasn’t exaggerating, at least not much. So far, Novavax’s vaccine has obtained approvals in Australia, Bangladesh, Canada, the European Union, Britain, India, Indonesia, New Zealand, the Philippines and South Korea. South. It has also received the World Health Organization’s Emergency Use List.
The FDA certainly has the ability to make a decision faster, as evidenced by its rapid approvals for the Pfizer-BioNTech and Moderna vaccines. Novavax obviously has the clinical data to support the authorization of its vaccine, as evidenced by the long list of other positive regulatory decisions.
There’s an old adage that goes, “If it looks like a duck, swims like a duck, and quacks like a duck, then it’s probably a duck.” The FDA’s slowness appears to pass the “duck test” for slowing an approval for Novavax’s COVID-19 vaccine.
Why snail speed?
What’s behind the FDA’s slow approval of Novavax’s vaccine? The agency probably doesn’t feel a sense of urgency.
It is understandable to some extent. After all, the “E” in EUA stands for “emergency”. Three COVID-19 vaccines are already available in the United States More than 217 million Americans have received at least two doses of the vaccine. Nearly 97 million of them also received a booster dose.
In contrast, 23% of Americans are still unvaccinated. Novavax’s vaccine was developed using a more traditional approach (protein subunits). Some who have been hesitant to receive a messenger RNA or DNA vaccine may be more receptive to the company’s vaccine.
Additionally, despite a drop in the number of COVID-19 cases in the United States, there is still cause for concern. China is experiencing its worst coronavirus outbreak since 2020. COVID-19 cases are also rising in Europe. It is entirely possible that the United States will face another wave in the not too distant future.
Pfizer and Moderna are seeking FDA clearances for additional booster doses. However, many countries still do not have enough vaccines. The United States could give more doses to these countries if the Novavax vaccine receives the EUA.
Novavax shares have plunged nearly 70% from last year’s highs. The longer the FDA takes to make a decision, the more a cloud of uncertainty will hang over the vaccine stock. Some investors might worry that an extended EUA review period will increase the likelihood that Novavax’s vaccine will not gain US approval.
I’ll take a chance and make a prediction, though. I think the FDA will grant EUA to Novavax’s COVID-19 vaccine. I also expect the decision to come in April, if not sooner. Admittedly, this prediction could be entirely off the mark. But I think there’s a good chance it turns out to be right.
Will the US EUA be enough to trigger a rebound in Novavax stock price? That should help. An even bigger catalyst, however, would be for the company to secure major supply deals for 2023 and beyond. Like the potential FDA clearance, however, it’s something investors will still have to wait for.
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Keith Speights owns Pfizer. The Motley Fool recommends Moderna Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.