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Is Vaccine Maker Vaxart Worth Holding From Here?

By Brian Orelli, PhD and Keith Speights - May 9, 2021 at 2:14PM

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As with most investment decisions, whether to hold depends on the situation. Here are some things to think about.

Shares of vaccine expert Vaxart (VXRT 2.21%) have gone on a wild ride over the past 12 months as the company has released data for its coronavirus vaccine. In this video from Motley Fool Live, recorded on April 5, Contributors Brian Orelli and Keith Speights discuss Vaxart's prospects and whether investors should continue to hold shares of the biotech.

Brian Orelli: We have a question about Vaxart. Is it worth holding? And the person has a small position.

Keith Speights: I think every investor has to make their own decision. Brian and I have talked about Vaxart some. Let me just say this. Like any clinical-stage biotech with a candidate that's in early-stage testing, Vaxart is very risky. Just know that.

Orelli: Keeping it through a small percentage of your portfolio is a good move by this member.

Speights: Yeah. But having said that, I'm not sure when the viewer bought their shares, but Vaxart stock just plummeted after some results that many saw as very disappointing. You have to make your own call here, but if the reasons why you bought the stock haven't really changed, then there's no reason to sell it. If you bought the stock; let's say you bought it after the news came out about some -- Brian, help me here. I think it didn't produce neutralizing antibodies.

Orelli: That's correct. It produced maybe T-cells. It seemed to be showing that it was possibly working, but it didn't produce neutralizing antibodies at a very high level.

Speights: Right. If you bought shares after that news, nothing's really changed, so there's really no reason to sell. Let's say you bought the stock before that news broke. Well, you've already gone through the downturn now, and so maybe the best thing to do is hold on and see how things pan out. Again, if you'd have a really small position, you're not risking a lot either way, and so I think some investors might be inclined to sell, but other investors might be saying, I want to hold on and let's see if Vaxart comes out with better results going forward and changes opinion about its vaccine, and that's very possible. This is a [laughs] personal decision. I couldn't tell you you what to I would do.

Orelli: They have a norovirus vaccine and an influenza vaccine in phase 1 development, and they're looking to out-license the influenza vaccine. There's potential other milestones that they could reach before they end up with phase 2 COVID-19 data. I think the main issue is COVID-19 is just, they're going to be so far behind that even if the vaccine ends up working, by the time they get through phase 3, where they are going to be, and even, how hard is it going to be for them to do a phase 3 when there's so many FDA authorized vaccines? Are they going even be able to run phase 3 clinical trials, or is the FDA going to let them just show that they have the antibodies? And if they can't produce antibodies, then it's going to be hard for them to show that they can protect against COVID-19.

Speights: Let's say Vaxart is successful, though. I mean, I think that could have a good market opportunity because it's an oral vaccine and I think that would be very attractive, especially to developing countries across the world just in terms of logistics, shipment and storage, and that kind of thing.

Orelli: Yeah, that's true.

Brian Orelli, PhD, Keith Speights, and The Motley Fool have no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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