Novavax (NVAX 4.95%) shares climbed 2,700% last year as investors bet on the biotech company's investigational coronavirus vaccine. But the share price's story doesn't end there. Last week, the stock soared nearly 65% in just one trading session. What prompted such a jump? Novavax said its vaccine candidate was effective against the U.K. and South African strains of the virus in clinical trials. This was welcome news given one of the biggest worries these days -- that currently available vaccines won't hold up against these new strains. The company also reported phase 3 efficacy data concerning the older version of SARS-CoV-2.
You're probably asking yourself whether all of this offers Novavax an advantage over its more advanced rivals, Moderna (MRNA 0.59%) and Pfizer (PFE -1.49%). The U.S. Food and Drug Administration (FDA) offered their vaccines Emergency Use Authorization (EUA) late in 2020. Let's take a closer look at three key points to see how Novavax measures up.
A first glance, general efficacy shows Novavax's candidate lagging behind those of its commercialized rivals. Moderna and Pfizer reported efficacy of 94.1% and 95%, respectively, for their vaccines. Like Novavax's candidate, these vaccines both involve two doses, and full efficacy kicks in after the second dose.
Novavax reported 89.3% efficacy. But here's one important factor to keep in mind: Novavax's phase 3 trial took place in the United Kingdom -- home of the U.K. strain. And the U.K. strain has become more and more prevalent both there and elsewhere. Moderna and Pfizer generated their trial data before the newer variants of concern had gained ground. Their vaccines were primarily fighting the virus they were designed to fight: the original strain of SARS-CoV-2.
Novavax's vaccine -- like those of Moderna and Pfizer -- also was designed to combat the first version of the novel coronavirus; it's clear that efficacy will be higher when faced only with that version. In fact, Novavax calculated its candidate's efficacy against the earlier coronavirus at 95.6%.
2. New strains
Let's talk about new strains of the virus. Moderna and Pfizer have said their vaccines can handle the newer variants.
Moderna performed in vitro studies with blood serum from those vaccinated and found neutralizing antibody levels remained about the same when the U.K. strain was introduced. The South African strain resulted in a sixfold decline in antibody levels -- but they still remained high enough to maintain protection. Pfizer, in a similar in vitro test, introduced engineered viruses with key mutations from the U.K. and South African strains. The company's findings echoed those of Moderna.
As for Novavax, its investigational vaccine actually confronted these new strains during clinical studies rather than during in vitro testing. The company said its vaccine candidate was 85.6% efficacious against the U.K. strain in the U.K. phase 3 trial. In South Africa, a phase 2b trial demonstrated 60% efficacy against SARS-CoV-2 -- and about 90% of cases detected in the trial were of the South African strain. (This includes only HIV-negative trial participants.) This strain contains a mutation that helps it escape antibodies produced post-vaccination. Novavax's vaccine candidate demonstrated some protection against this variant -- and even some protection is welcome.
3. Severe disease
It's difficult to make a firm statement on severe disease due to the difference in trial size among the three companies, though Moderna and Novavax have an edge so far. Both companies reported no cases of severe coronavirus among those who received their vaccines in phase 3. Pfizer, however, reported one case of severe COVID-19 in a vaccinated trial participant.
Here's how the numbers look:
|Company||Trial Participants||COVID-19 Cases||Cases in Vaccine Group||Severe Cases in Vaccine Group|
Why is prevention of severe disease so important? Severe disease is what leads to hospitalization, complications, and even death -- so one of the biggest goals of vaccination is to prevent extreme illness. A vaccine that could fully protect against this over time could clearly take market leadership.
So, how do things look for Novavax?
Looking at overall efficacy against the original SARS-CoV-2 virus, Novavax is on par with Moderna and Pfizer. As more and more data are collected from the trials, the numbers may shift slightly. But all three so far have reached more than 94% efficacy against the original strain. And that's positive news.
Novavax has tackled new strains in the real world and showed its candidate can hold up. However, it's possible that the Moderna and Pfizer vaccines, if also tested now in the U.K. and South Africa, would produce similar results. After all, their in vitro tests were encouraging.
As for preventing severe disease, Novavax and Moderna are leading in this area.
Overall, I would say Novavax may be on its way to becoming one of the strongest players. The biotech company clearly could enter the market on the same footing as its more advanced rivals. And that means billions of dollars in revenue it's hoping for are looking more and more likely.