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Respiratory syncytial virus (RSV) has stumped vaccine developers for more than 50 years, despite its enormous burden. Novavax (NVAX -0.47%) shareholders enjoyed some terrific gains last August when the company's RSV F Vaccine became the first immunization to show a significant decrease in respiratory illness due to RSV in a 1,600-patient clinical trial with older adults.

The observed rate of protection was just high enough to be considered significant, but hardly airtight. For vaccine studies, though, 1,600 patients isn't quite large enough to draw conclusions. Many assumed the larger, 11,850-patient phase 3 trial with similar patients would provide definitive proof of the vaccine's efficacy, but were caught off guard when the company announced it failed miserably.

The company isn't giving up on the program, nor is it terminating an ongoing 8,255 patient phase 3 trial with RSV F Vaccine in healthy pregnant women. Following the post-announcement implosion, Novavax stock has rebounded more than 80%, leaving investors to wonder if there's something salvageable from the wreckage.

Let's take a closer look at the RSV F Vaccine program to see if the recent uptick is warranted.

Attack rates or outcome measurements?

The primary goal of the failed phase 3 trial was prevention of moderate-to-severe RSV-associated lower respiratory tract disease, as defined by three reported RSV symptoms confirmed by a diagnostic test. The result was that 0.47% of patients receiving the vaccine met this definition of infection versus a slightly lower 0.44% in the placebo group during the six-month observation period -- a shockingly disappointing result.

The company was quick to blame a much lower disease attack rate during the phase 3 trial than during the previously successful phase 2 study. This excuse doesn't jive with a statement made during the company's conference call in May at the end of the RSV season. At the time, Novavax Research and Development President Dr. Greg Glenn told analysts that the most recent RSV season was consistent with previous years according to data from RSVAlert and the Centers for Disease Control and Prevention (CDC).

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It's important to point out the different outcome measurements in the successful phase 2 and failed phase 3 trials in older adults. The successful phase 2 trial barely reached statistical significance with a p-value of 0.041 -- just under the generally accepted maximum level of 0.05 -- for reduction of infection as defined by just one symptom of RSV, confirmed by a diagnostic. The phase 3 protocol tightened up the symptom definition concerning sputum production, and made RSV infection with a single symptom a secondary goal, which the vaccine also failed to significantly prevent. 

Whatever the excuse, RSV F Vaccine in older adults appears doomed. An abnormally low attack rate might give Novavax some breathing room to explore multiple dosing options for a longer trial, but that's a hard pill to swallow given the company's previous statements and lack of significant data from a second-year rollover trial with patients from the successful phase 2 study.

The Food and Drug Administration (FDA) tends to be clear about what it wants to see in trials intended to support new drug applications. If the protocol changes from phase 2 to phase 3 were informed by the FDA, and somehow resulted in the dismal failure to reduce infection rates, don't expect the regulator to bend.

What about maternal immunization?

Worldwide, RSV is the second-leading cause of death in children under the age of one. In the U.S., it's the leading cause of infant hospitalizations. An ongoing phase 3 trial with RSV F Vaccine in pregnant women to determine its ability to reduce rates of RSV infection in infants during their first 90 days might offer a shred of hope for the program.

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Unfortunately, we don't have any infection rate data to chew on. The Bill and Melinda Gates Foundation sponsored the phase 3 trial following results from a 50-patient phase 2 study that showed pregnant women injected with RSV F Vaccine had vastly increased RSV-specific antibodies compared to women given a placebo, and those antibodies transferred to their babies. Sadly, phase 2 studies in older adults also showed increased RSV-specific antibodies, but they didn't lead to significantly lower rates of infection in phase 3. 

Another dark cloud hanging over the phase 3 maternal immunization trial is Novavax's omission of infection measurements from the 50-patient phase 2 trial announcement. Granted, 50 patients split into two groups wouldn't provide statistically relevant infection data, but the company's decision to omit these outcome measurements defined in the trial's protocol is troubling.

Until we have a clear indication that the RSV F Vaccine is effective, I wouldn't try to catch this falling knife at any price.