What happened
Investors in Novavax (NVAX 3.54%) haven't had much to celebrate recently, but the stock is rocketing higher on Tuesday. As of 11:30 a.m. ET, Novavax shares were up more than 17%, despite the overall stock market being flat.
So what
In a nutshell, Novavax announced that its updated COVID-19 vaccine candidate showed that it was effective against newer variants of the virus, including those that are dominant in the U.S. and are responsible for a recent rise in COVID-19 infections and hospitalizations.
The tests were performed on small animals and primates. Novavax said its updated shot produced neutralizing antibody responses to the fast-spreading Eris variant, as well as others that are in wide circulation in the U.S.
Now what
Novavax said that it is in the process of submitting applications for its updated vaccine globally, and this recent news is clearly a step in the right direction.
However, it's important to mention that the company continues to struggle to keep up with its larger competitors like Moderna. And remember that a few months ago, Novavax actually expressed concerns about its ability to survive beyond its current fiscal year, and shares are still about 97% below their pandemic-era highs.
It's fair to say that if the updated vaccine sells well, Novavax could end up generating the near-term cash flow it needs to survive and focus on bringing other products to market.
