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Why VBI Vaccines Rallied 11.3% Today

By Todd Campbell – May 6, 2020 at 5:13PM

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The company hopes to file for FDA approval of its hepatitis B vaccine this year.

What happened

Shares of VBI Vaccines (VBIV -1.48%) jumped 11.3% on Wednesday after the company reported its first-quarter financial results and updated investors on its clinical-stage drug pipeline.

So what

VBI Vaccines' update detailed its plans to file for Food and Drug Administration approval of its hepatitis B vaccine, Sci-B-Vac, in Q4. If approved, Sci-B-Vac will compete against GlaxoSmithKline's (GSK -1.35%) blockbuster Engerix-B and Dynavax's (DVAX -1.93%) Heplisav-B, which won FDA approval in 2017.

An upwardly trending arrow drawn on a chart.

IMAGE SOURCE: GETTY IMAGES.

The timeline is encouraging because the healthcare company's shares crashed in 2019 after pivotal trial results for Sci-B-Vac failed to show superiority to Engerix-B in the two-dose cohort. If it is unable to reduce patient dosing from Engerix-B's three-dose regimen to two doses, it could be trickier for VBI Vaccines to win market share.

Management also said it plans to provide data from a phase 1/2 trial evaluating its glioblastoma immunotherapeutic, VBI-1901, this year. Furthermore, it said it was evaluating a pan-coronavirus prophylactic vaccine that could be ready to enter trials by the end of this year. 

Now what

Sales of Heplisav-B were just $10.6 million in Q4, so it's uncertain if VBI Vaccines will be able to differentiate itself enough to establish a meaningful foothold in the hepatitis B vaccine marketplace. 

Nevertheless, the company's progress toward commercialization is encouraging, especially given how other pipeline projects are advancing. If VBI-1901's data is solid, it would be particularly encouraging, given that there are limited treatment options currently available in glioblastoma. Additionally, the potential for a pan-coronavirus vaccine that could address not only COVID-19, but also SARS and MERS, is intriguing.

It's also encouraging that the company's recent stock offering has bolstered its balance sheet, providing management with more financial wiggle room. VBI Vaccines exited March with $35.8 million on the books, but it added $54 million via a public offering in April. Nonetheless, there are no guarantees any of the candidates in the company's pipeline will pan out, so investors might want to focus for now on other stocks where there's more clarity about the future.

 

Todd Campbell has no position in any of the stocks mentioned. His clients may have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Stocks Mentioned

VBI Vaccines Stock Quote
VBI Vaccines
VBIV
$0.71 (-1.48%) $0.01
GSK Stock Quote
GSK
GSK
$30.00 (-1.35%) $0.41
Dynavax Technologies Stock Quote
Dynavax Technologies
DVAX
$11.18 (-1.93%) $0.22

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