Big news from Novavax (NASDAQ:NVAX) comes at just the right time. The vaccine maker announced it was taking its novel coronavirus candidate into Phase 3 trials in the United Kingdom. NVAX stock is rallying more than 10% as a result. What do investors need to know?
To start, the main driver of the NVAX rally comes from news of the trial itself. Novavax plans to enroll 10,000 participants in a Phase 3 trial in the United Kingdom. With help from the government, these trials should be ready to go in no more than six weeks. Once Novavax finalizes its participant list, it will test a two-dose vaccine regimen over a three-week period. Importantly, this is only one of many large-scale trials the company is planning to launch.
Novavax continues to be a red-hot opportunity in the market. Up until now, it was one of the few leaders in the vaccine race that had yet to enter late-stage trials. Rivals AstraZeneca (NYSE:AZN), Pfizer (NYSE:PFE), Johnson & Johnson (NYSE:JNJ) and Moderna (NASDAQ:MRNA) all recently announced the launch of their trials. But there are a few reasons why investors are still confident in NVAX stock.
The first is that Novavax is sticking with a more time-tested vaccine. Its candidate is a protein-based vaccine, unlike more experimental vaccine candidates that use messenger RNA. This may mean that it has a better chance of success, or that consumers will trust it more if it makes it to mass deployment. Novavax has also courted supply and manufacturing deals, giving it a leg up. As we reported recently, it now has the ability to produce 2 billion doses of its vaccine by the end of 2021.
NVAX Stock Rallies on Phase 3 Launch
Investors are perhaps most excited — and relieved — because of the specific timing of the launch. Just this morning, we learned that the United Kingdom recorded a record number of new cases. Prime Minister Boris Johnson has been warning the nation over coronavirus risks, urging citizens to work and stay at home as much as possible. Novavax launching its late-stage trials in the U.K. with the help of its government may be a blessing for the company and the country.
Novavax may be an underdog compared to the likes of AstraZeneca and Johnson & Johnson, but it is keeping up the pace. Plus, many public health experts are excited about the ramifications of this trial. The company has shared it will work to examine disparate impacts of the coronavirus on racial and ethnic minorities, prioritizing their protection in late-stage trials.
Additionally, it will study the effects of its candidate in conjunction with a standard seasonal flu shot.
Keep a close eye on NVAX stock. It could keep shooting higher.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer for InvestorPlace.com.