What happened

Shares of Novavax (NVAX -0.95%) were sinking 12.3% as of 11:06 a.m. EDT on Friday. The steep decline didn't stem from any negative development for the biotech but instead appeared to be caused by the overall stock market sell-off.

So what

What does the big drop for the biotech stock today mean for investors? At worst, nothing. At best, an opportunity to buy Novavax at a cheaper price.

Scientist holding syringe and vaccine bottle

Image source: Getty Images.

Most stocks fall when the overall market falls significantly (and rise when the market rises significantly). Those gyrations, though, often have no connection whatsoever with the individual stocks' prospects. That's definitely the case with Novavax.

How the economy is doing or what the latest jobless numbers are really don't matter for Novavax. What's most important for the biotech is how its COVID-19 vaccine candidate NVX‑CoV2373 performs in clinical testing.

So far, the story on this front is a good one. Novavax announced on Thursday that The New England Journal of Medicine published additional details from a phase 1 study of the experimental vaccine. The new data looked as promising as earlier results.

Now what

Novavax's shares could continue to be highly volatile, especially if the stock market remains choppy. The main thing to watch, though, is the progress of its phase 2 study evaluating NVX‑CoV2373. The company expects to report interim results in the fourth quarter of this year.