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Novavax, Inovio Stocks Hammered As Covid Vaccine News Disappoints

Vaccine stocks crumbled Tuesday after Novavax (NVAX) announced a delay and Inovio Pharmaceuticals (INO) reported “underwhelming” results for its Covid vaccine. Both NVAX stock and INO stock plunged.




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Novavax says it now plans to seek authorization for its Covid vaccine in the U.S., U.K. and Europe in the third quarter. That’s a one-quarter delay.

Meanwhile, Inovio unveiled underwhelming results from its midstage Covid vaccine test, RBC Capital Markets analyst Gregory Renza said in a report to clients. He says antibody levels produced by the vaccine called INO-4800 appear lower than the levels generated by natural infection.

“We believe the immunogenicity data could keep INO-4800 from staying competitive in the space, which is exacerbated by the emerging variants that may reduce the protective (effectiveness) of INO-4800 targeting the original strain,” he said.

NVAX Stock Dives On Delay

In morning trading on the stock market today, NVAX stock crashed 16.9% near 133.50. INO stock tumbled 12.3% to near 5.90.

The delay for Novavax is particularly troublesome for NVAX stock investors. Previously, the biotech company planned to request authorization in the second quarter.

Novavax is already trailing Pfizer (PFE) with its partner BioNTech (BNTX), and Moderna (MRNA), which launched their Covid vaccines in December. Johnson & Johnson‘s (JNJ) hit the market in March. Assuming it launches in the U.S., U.K. and Europe, Novavax’s vaccine will have missed the lion’s share of first-round inoculations.

Still, bullishly for NVAX stock, the Covid vaccine continues to look strong.

Novavax reiterated in its earnings news release that the vaccine was 96.4% effective against the original Covid strain in a late-stage test, and 55.4% effective in HIV-negative South Africa participants. The vast majority of cases in South Africa are due to a variant first discovered in that country.

INO Stock Topples On Test Results

INO stock analysts were split on Inovio’s news.

First of all, the company reported a 27-cent per-share loss and $371,000 in revenue. Both measures lagged, RBC’s Renza said. Analysts called for a 19-cent per-share loss and $1.1 million in revenue.

Further, like NVAX stock, INO stock was hamstrung on its Covid vaccine news.

In Phase 2 testing, participants received an injection — either the vaccine or a placebo — followed by use of Inovio’s medical device. That device delivers a low voltage electric shock to coax the vaccine into cells. The vaccine was generally safe and well tolerated.

But the antibodies secreted by the plasma cells were “just a fraction” of what researchers have found in recovered Covid patients, Piper Sandler analyst Christopher Raymond said in a report to clients. He kept his neutral rating and 7 price target on INO stock.

On a year-to-date basis, INO stock has crashed 32%. NVAX stock has climbed 11%. Its stock has now round-tripped its late January breakout with a buy point at 150.60 out of a consolidation, according to MarketSmith.com.

Follow Allison Gatlin on Twitter at @IBD_AGatlin.

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