Novavax (NVAX 2.53%) announced on Monday that it plans to raise around $200 million through a private placement with RA Capital Management. An investment fund affiliated with RA Capital will purchase a quantity of Series A Convertible preferred stock from Novavax that is convertible into 4,388,852 shares of common stock.
The biotech intends to use the additional capital to help fund its development of a COVID-19 vaccine candidate and to advance its U.S. regulatory filing for approval of flu vaccine NanoFlu. CEO Stanley C. Erck stated that Novavax believes that the RA Capital transaction "signals a high level of confidence in the significant progress of our COVID-19 and influenza vaccine programs."
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RA Capital Management Managing Partner Peter Kolchinsky supported Erck's take, and particularly noted that the investment "will support Novavax in its important work developing an effective, scalable vaccine for SARS-CoV-2."
The private placement will bolster Novavax's cash position, which as of March 31 was $244.7 million, including cash, cash equivalents, marketable securities, and restricted cash. In May, the company announced that it will receive up to $384 million in additional funding from the Coalition for Epidemic Preparedness Innovations (CEPI) to develop and manufacture its COVID-19 vaccine candidate. Novavax has already used some of its cash to acquire Czech-based Praha Vaccines to boost its COVID-19 vaccine manufacturing capacity.
