What happened

The prospective coronavirus vaccine maker Vaxart (VXRT 0.93%) crashed by 38.6% in May, according to data provided by S&P Global Market Intelligence. The tumble was caused by the company's publication of new data about its coronavirus vaccine pill on May 3, which failed to show high levels of neutralizing antibodies in a clinical trial despite showing other signals of immune system activation.

So what

Vaxart's coronavirus candidate had shown the same weaknesses in prior data readouts in February, meaning that the latest results served to cement investors' low expectations for its efficacy. Given that competitors like Pfizer and Moderna have both successfully marketed coronavirus vaccines which generate strong antibody responses, it's unlikely that Vaxart's program has much of a future. So far, the company appears to be continuing with development as before in hopes of finding a niche in the market. While it may eventually find that niche in the form of healthcare systems in developing countries, it probably won't be competitive in the most lucrative developed markets like the U.S.

A scientist sitting at a laboratory bench expresses frustration as she consults a tablet computer sitting next to her microscope.

Image source: Getty Images.

Still, management was quick to point out that its candidate strongly elicits T-cell mediated immunity, potentially beyond that of the major competing vaccines. But, because T-cell mediated immunity may not be as likely to stonewall symptomatic infections as antibody mediated immunity in the context of coronavirus infections, it's a cold comfort for investors. 

Now what

Despite the discouraging results, Vaxart's greatest strength is that its vaccines are formulated as pills rather than liquids for jabs. That means they don't need specialized refrigeration to be stored, nor do they need trained staff to be administered. So, there's still a role for the company's products to fill and a potential competitive advantage to be had, provided that in the future they can be proven to be effective at generating the correct type of immune response for their target disease.

On May 7, the company started to enroll new patients in a phase 1 trial of its norovirus vaccine candidate. While it's unclear if the project will allow Vaxart to shift gears and grow for its investors, it'll definitely provide a new chance to demonstrate that its vaccine technology works in the future.