At the start of the year, Vaxart (NASDAQ:VXRT) was a biotech company with a market cap of about $17 million and a stock price of less than $1. Once the company entered the coronavirus vaccine race, however, its fortunes -- and those of its investors -- changed. The stock climbed as much as 4,600% to its peak in July, and its market value rose to as much as $1.8 billion.

If you invested $5,000 on Jan. 2 when the stock was trading at $0.36 and then sold at the high point this summer, you would have made $230,696. The stock has since pared its gains; rivals moved closer to the coronavirus vaccine finish line and Vaxart didn't receive Operation Warp Speed (OWS) funding as some investors had hoped. OWS is the White House's initiative to help bring a coronavirus vaccine to market. Ten programs are in phase 3 studies; Vaxart recently announced the start of its phase 1 trial. If you held onto your Vaxart investment, today you would have $78,334. Whether you sold in July or held on, you still have something to smile about. Now the question is: Are more gains on the horizon? Let's take a look at where things stand for this biotech company.

A woman holds a glass in one hand and pill in the other.

Image source: Getty Images.

First human study

In October, Vaxart launched the first human study of its vaccine candidate for COVID-19. The trial will examine safety and immune response in 48 volunteers ages 18 through 54. Researchers will administer two doses, 28 days apart. The company expects to complete enrollment in early November. Vaxart says initial results likely will be available "in the next few weeks."

With so many rivals in late-stage studies, it's unlikely that Vaxart will be the first to win an Emergency Use Authorization or regulatory approval. But there is something about Vaxart's candidate that makes it particularly interesting -- and means that if clinical trials are successful, the product could be a game-changer.

Vaxart's vaccine candidate isn't administered by injection. The potential product is a tablet to be swallowed -- as simple as a pill for a headache. This is an advantage from the patient point of view since most people don't like the idea of getting a shot in the arm. And it's also an advantage from a logistics and distribution point of view. The tablet is room-temperature stable, meaning it doesn't need cold storage and transport like traditional vaccines. That could make vaccination across populations easier and less expensive.

Convenience of a tablet

Other coronavirus vaccines may be available by the time a potential Vaxart vaccine wins regulatory approval. But the convenience of a tablet form surely would help Vaxart take a share of the market -- regardless of when the company enters. And worldwide need for a vaccine means there is room for more than one player, so concern about Vaxart's program due to the timeline is unjustified.

As for efficacy, preclinical data has shown promise. In a recent study, 100% of hamsters that were given two doses of the investigational vaccine didn't lose weight after exposure to the coronavirus. This is an indicator of efficacy in this particular animal model since weight loss is a coronavirus symptom in hamsters. Researchers noted weight loss and evidence of lung disease in the unvaccinated hamsters exposed to coronavirus.

All of this is positive. But investment in Vaxart still carries a good deal of risk. While the coronavirus vaccine program has proceeded smoothly so far, now comes the big test: human trials. Anything can happen -- even in a late-stage human study.

Share gains ahead?

If Vaxart's program is successful, it's clear that big share gains could be ahead. But if it fails, we can expect a dramatic drop in the shares. Vaxart is a clinical-stage company, so it doesn't have other products on the market. That means it doesn't have an immediate source of revenue. And all of Vaxart's pipeline programs are in phase 2 studies or earlier. That means it doesn't have a potential source of revenue in the near future, either.

What's an investor to do in this situation? Think of your risk tolerance. If you're an aggressive investor and like Vaxart's overall program, you might want to consider taking a position in the shares. If you're a cautious investor, you probably should avoid the shares -- or take a small position and be willing to accept a positive or negative outcome.

In any case, Vaxart, with its potentially game-changing technology, is a biotech company to watch in the months ahead.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.