Novavax, Inc.

Case Details

Class Period: March 3, 2021 - October 19, 2021
Date Filed: November 12, 2021
Case Number: 8:21cv02910
Jurisdiction: Maryland District Court
icon-casetype Case Type: Securities Case
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Case Summary

Novavax is a biotechnology company that focuses on the discovery, development, and commercialization of vaccines to prevent serious infectious diseases and address health needs. The Companys product candidates include, among others, NVX-CoV2373, which is in development as a vaccine for COVID-19. Prior to the start of the Class Period, Novavax announced that it planned to complete Emergency Use Authorization (EUA) submissions for NVX-CoV2373 with the U.S. Food and Drug Administration in the second quarter of 2021. Throughout the Class Period, Defendants made materially false and misleading statements regarding the Companys business, operations, and prospects. Specifically, Defendants made false and/or misleading statements and/or failed to disclose that: (i) Novavax overstated its manufacturing capabilities and downplayed manufacturing issues that would impact its approval timeline for NVX-CoV2373; (ii) as a result, Novavax was unlikely to meet its anticipated EUA regulatory timelines for NVX-CoV2373; (iii) accordingly, the Company overstated the regulatory and commercial prospects for NVX-CoV2373; and (iv) as a result, the Companys public statements were materially false and misleading at all relevant times. On May 10, 2021, The Washington Post reported that Novavaxs EUA filing was delayed by manufacturing regulatory issues, until June at the earliest, according to four people who had recently been briefed on the [C]ompanys plans. Later that day, during after-market hours, on a call that Novavax hosted with investors and analysts to discuss the Companys first quarter 2021 financial and operational results (the 1Q21 Investor Call), Novavax confirmed that it was unlikely to seek an EUA for NVX-CoV2373 in the U.S. until July 2021 at the earliesti.e., the third quarter of 2021. Following publication of The Washington Post article, Novavaxs stock price fell $15.50 per share, or 8.81%, to close at $160.50 per share on May 10, 2021. Moreover, following the Companys 1Q21 Investor Call, Novavaxs stock price continued to fall an additional $22.32 per share, or 13.91%, to close at $138.18 per share on May 11, 2021. Then, on August 5, 2021, Novavax issued a press release reporting its financial results and operational highlights for the second quarter of 2021. Among other news, Novavax reported that it expected to file for NVX-CoV2373s EUA in the fourth quarter of 2021, rather than the third quarter of 2021. On this news, Novavaxs stock price fell $46.31 per share, or 19.61%, to close at $189.89 per share on August 6, 2021. Finally, on October 19, 2021, Politico published an article entitled They rushed the process: Vaccine makers woes hamper global inoculation campaign. The Politico article reported, in relevant part, that Novavax faces significant hurdles in proving it can manufacture a shot that meets regulators quality standards with respect to NVX-CoV2373. The Politico article cited anonymous sources as stating that Novavaxs issues are more concerning than previously understood and that the Company could take until the end of 2022 to resolve its manufacturing issues and win regulatory authorizations and approvals. On this news, Novavaxs stock price fell $23.69 per share, or 14.76%, to close at $136.86 per share on October 20, 2021.