Novavax (NVAX -3.63%) shares soared a whopping 2,700% last year. That might make you say the best times are behind this high-flying biotech stock. But I don't think the Novavax story is over. In fact, we're reaching the most interesting part of this exciting story right now -- and that means we shouldn't close the book and put it back on the shelf.

Of course, it's hard to imagine that Novavax shares will replicate their 2020 performance in 2021. But most investors would be satisfied with a steady gain over time based on sales and profit growth. And that just might be on the horizon for Novavax. Let's take a closer look at why the best is yet to come for this clinical stage biotech company.

A man sitting in front of his laptop cheers.

Image source: Getty Images.

The story a year ago

About a year ago, Novavax had this to look forward to: the potential regulatory clearance of NanoFlu, its flu vaccine candidate. The company had just reported positive pivotal trial data. Novavax had already launched development of a coronavirus vaccine candidate. But things were early stage, and therefore, risk of failure was high. Novavax also didn't have the infrastructure or funds to fully develop and commercialize a coronavirus vaccine.

And then, bit by bit, the good news came rolling in. The investigational candidate progressed successfully from preclinical to clinical trials. Operation Warp Speed granted Novavax $1.6 billion in funding. And Novavax invested in capacity -- so much that the company expects to produce as many as 2 billion doses annually by the middle of this year.

In more recent days, Novavax gave us more good news. Its coronavirus vaccine candidate showed 96.4% efficacy against the original coronavirus in a U.K. phase 3 trial. That beats leaders Moderna and Pfizer. Those commercialized vaccines showed efficacy of 94.1% and 95%, respectively, in phase 3 trials. Even better, Novavax's trials took place in the U.K. and South Africa. And that means the company generated data regarding two variants of concern gaining ground in those locations. The results? The Novavax investigational vaccine was 86.3% efficacious against the U.K. strain and 55.4% efficacious against the South African strain.

Novavax also is studying the vaccine candidate in a U.S. phase 3 trial. The company expects to generate data in the coming weeks and complete a request for Emergency Use Authorization during the second quarter.

A bright future

If all goes smoothly and regulatory agencies grant Novavax authorization, the future is bright. The company has supply agreements for about 300 million doses of vaccine. That represents $4.8 billion in revenue, if we use the $16-per-dose price paid by the U.S. as a guide. Novavax plans to start clinical trials of a strain-specific booster or combined vaccine to better handle strains by midyear. This represents another revenue opportunity between full vaccinations.

Some research has shown that antibody production in recovered coronavirus patients lasts at least five to seven months. So, if vaccine protection produces similar results, we may need vaccination, or a booster, once a year. This equals an annual revenue opportunity for Novavax.

And let's not forget about NanoFlu. Novavax appointed a team of experts late last year to shepherd the candidate through regulatory approval. And at the same time, Novavax said it would explore a combined coronavirus and flu vaccine. That would involve combining NanoFlu with the investigational coronavirus vaccine. Flu shots represent an annual revenue opportunity. The flu shot market, at a 6.9% compound annual growth rate, is expected to reach $7.6 billion by 2027, according to Fortune Business Insights.

So what's ahead for Novavax? Potential revenue from two products likely to be used on an annual basis. And at least one of those products -- a coronavirus vaccine -- could result in blockbuster level revenue. Getting back to the subject of share price -- as I mentioned, I don't expect another 2,000% gain in a year. But if Novavax brings a coronavirus vaccine and a flu vaccine to market, revenue could be big. And that should lead to profit and lasting share gains over time. In that case, the best is yet to come for Novavax -- and long-term investors.