Vaxart (NASDAQ:VXRT) made some investors quite wealthy in 2020. Its shares skyrocketed more than 1,500% on increasing enthusiasm about its tablet COVID-19 vaccine program. That momentum carried over into this year, with Vaxart stock more than quadrupling year to date by early February.

But the joyride ended abruptly after Vaxart reported preliminary results from a phase 1 study of its oral COVID-19 vaccine, VXA-CoV2-1. The stock is now nearly 70% below its high set a month ago.

Still, there's the possibility that Vaxart could mount a comeback. Could it even be a millionaire-maker stock over the long run?

Man wearing a sportscoat pointing to lighted dollar signs

Image source: Getty Images.

The main hurdle to jump

Vaxart's big sell-off in February underscores the main hurdle the company must jump to deliver huge returns for investors. Neither neutralizing antibodies nor immunoglobulin G (IgG) responses were detected in most participants in the early stage study of VXA-Cov2-1. 

The COVID-19 vaccines developed by Pfizer and its partner BioNTech and by Moderna achieved high levels of neutralizing antibodies in early stage clinical studies. Both vaccines ultimately proved to have efficacy levels of 94% or more against the coronavirus that causes COVID-19.

However, Vaxart highlighted that its tablet vaccine produced multiple immune responses, notably including "potent CD8+ T-cell responses." T cells can provide long-lasting immunity against viruses. Vaxart also thinks the CD8+ T cells could provide greater protection against new coronavirus variants.

To be sure, many observers believe that the lack of neutralizing antibodies diminished the chances of success for VXA-CoV2-1. But some remain cautiously optimistic. B. Riley Securities analyst Mayank Mamtani, for example, is still bullish about the prospects for Vaxart's COVID-19 vaccine. 

A potential path to success

If Mamtani and Vaxart are right, further clinical studies will show that VXA-CoV2-1 actually is highly effective and safe. That could set the stage for Vaxart to achieve significant commercial success over the long run.

The biotech's tablet vaccine offers several advantages over currently authorized COVID-19 vaccines. It's obviously more convenient to administer. It requires only one dose. It's easy to ship and can be stored at room temperature.

Should VXA-CoV2-1 go on to generate strong sales, it would give Vaxart the funds needed to fully develop its other vaccine candidates as well. The company's pipeline includes two other clinical-stage candidates, one targeting norovirus and the other targeting influenza. Vaxart also has experimental vaccines in preclinical testing for respiratory syncytial virus and human papillomavirus.

The company's technology could also potentially enable Vaxart to develop oral vaccines for a wide range of other viruses. Over time, Vaxart just might be a major player in the global vaccine market if all goes well.

Millionaire-maker?

Could Vaxart be a millionaire-maker stock? For a $10,000 investment in the biotech to grow to $1 million, Vaxart's market cap would have to approach $80 billion. It could happen, but it's certainly not an easy proposition.

We could say the same thing, of course, about any early stage biotech stock. There are multiple obstacles to overcome on the road to riches, including performing well in clinical studies and winning regulatory approvals. Any investor should recognize that the odds are stacked against a given stock generating the gains necessary to turn a relatively small initial investment into $1 million or more. Possible? Yes. Probable? No.

On the other hand, a stock doesn't have to be a millionaire-maker to be a big winner. Whether or not Vaxart still has what it takes to make investors a lot of money, even if not $1 million, depends in large part on how VXA-CoV2-1 fares in further clinical testing.

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.