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UPDATE 4-Novavax investor Shah Capital pushes for board shakeup

(Adds investor comments in paragraphs 3 and 5)

By Sriparna Roy

April 15 (Reuters) -

Novavax shareholder Shah Capital is pushing the vaccine maker to add two of its nominees to the board to help tackle "underperformance" at the company and improve its share price.

The hedge fund nominated Suresh Katta, founder and CEO of biotech firm Saama, and Venkat Peri, CEO of Quantiva Health, to Novavax's eight-member board, saying the duo had the experience in setting the company's strategic direction.

"We are confident that the appointment of these two highly experienced individuals to the board will be a crucial first step to moving beyond what has been an ineffective and old-fashioned strategic approach," it said in a statement on Monday.

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The Maryland-based vaccine maker has leaned on cost-cutting measures and commercial sales of its updated COVID vaccine to stay afloat, but faces significant financial difficulties and expects revenue this year to be flat or lower.

"I think this is just the first step ... they could have $2 billion top line if they play the cards right. So there is a lot more to do over here," Himanshu Shah, founder and chief investment officer of Shah Capital Management told Reuters.

Novavax missed out on the pandemic vaccine windfall enjoyed by mRNA rivals due to manufacturing issues that delayed filing for approval when COVID was raging.

The hedge fund has urged Novavax to adopt a marketing strategy going forward to capitalize on those who are hesitant to get a vaccine due to common side effects associated with the mRNA shots.

Novavax, whose shares are trading near a record low, is one of the most shorted stocks on the Nasdaq.

Its shares rose 3.3% at $4.42 in premarket trading.

(Reporting by Disha Mishra and Sriparna Roy in Bengaluru; Editing by Mrigank Dhaniwala, Ravi Prakash Kumar and Anil D'Silva)