What happened

Shares of Novavax (NVAX 0.57%) rose 110% in February, according to data provided by S&P Global Market Intelligence, as investors bet on companies that may develop a coronavirus vaccine to address the current global outbreak.

As the outbreak deepened, with COVID-19 coronavirus cases topping 93,000 worldwide, investors flocked to shares of companies working on -- or with technology to work on -- treatment and prevention. Novavax announced details of its program on Feb. 26, saying it is now examining several nanoparticle vaccine candidates in animal studies. Once the company chooses the best candidate, it aims to begin testing in humans by the end of spring.

Vials of vaccine solution, labeled 'Coronavirus Vaccine,' sit on a surface.

Image source: Getty Images.

So what

For a late-stage biotech company focused on vaccines, developing a coronavirus vaccine could be a big win. Novavax has already demonstrated the strength of its technology in preclinical testing of vaccines for Middle East respiratory syndrome and severe acute respiratory syndrome. That said, Novavax has more to gain through its development of a seasonal flu vaccine -- in phase 2 testing -- and respiratory syncytial virus (RSV), which is in phase 3 testing. Seasonal flu and RSV, a respiratory virus that causes cold-like symptoms, represent bigger long-term markets. The global flu vaccine market, growing at a compound annual growth rate of 7.7%, is expected to reach $7.3 billion by 2026, a report by Fortune Business Insights showed.

Now what

As long as the coronavirus outbreak continues, it's likely investors will monitor Novavax's vaccine development and the shares will benefit. That said, once the outbreak is over, the shares may lose the upward momentum. Long-term investors might want to watch and wait on this one and take a closer look at the company's entire pipeline before considering shares of this biotech company.