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Why Novavax's (NVAX) COVID Vaccine Struggles for Market Share?

Despite being one of the few companies to secure authorizations for its protein-based COVID-19 vaccine in more than 40 countries, Novavax, Inc. NVAX faces challenges in securing a foothold in the COVID-19 vaccines market.

Novavax’s COVID-19 vaccine is also its first marketed product. However, the product launch was delayed by almost a year due to the postponement of the regulatory filing with the FDA. The FDA filing, supposed to have been done by management in May 2021, was completed after multiple delays in January 2022. This delayed filing resulted in a subsequent delay in emergency approval resulting in a substantial loss of market share for the company. Novavax secured emergency use authorization (EUA) from the FDA for its COVID vaccine in July.

This delayed product launch allowed other COVID-19 vaccines developed by Pfizer PFE/BioNTech BNTX and Moderna MRNA to strengthen their position in the vaccines market. The vaccines developed by Pfizer/BioNTech and Moderna were also the first vaccines authorized by the FDA in 2020.

In fact, this was also one of the likely reasons for management to slash the company’s total revenue guidance for 2022 from $4-$5 billion to $2-$2.3 billion at the second quarter conference call. Most of the population already completed primary vaccination using Pfizer/BioNTech and Moderna’s approved mRNA-based vaccines.

Compared to Novavax’s COVID vaccine, the mRNA-based COVID vaccines have also exhibited high efficacy rates. Furthermore, Novavax has started securing authorizations for its COVID vaccine in the United States. In contrast, Pfizer/BioNTech and Moderna have already received full approval for their respective COVID-19 vaccines as a primary regimen in the United States. While Moderna’s vaccine is approved for use in adults, the Pfizer/BioNTech vaccine is approved for use in adults and adolescents.

The Pfizer/BioNTech and Moderna vaccines are also authorized for use in individuals aged six months and above in the United States. A third and fourth booster dose of these vaccines have been authorized for certain age groups by the FDA. Novavax’s COVID vaccine is authorized in the United States as a primary two-dose regimen for adults and adolescents, while a regulatory filing is pending before the FDA seeks authorization for the vaccine’s use as a booster dose.

Novavax is also lagging in the development of Omicron-specific vaccines. Last month, Moderna and Pfizer/BioNTech secured EUA from the FDA for their respective Omicron BA.4/BA.5-adapted bivalent vaccines as a single booster dose. While Moderna’s Omicron booster is approved for individuals 18 years of age and older, Pfizer/Moderna’s version is approved for people 12 and older. These vaccines have been specifically developed to cater to the U.S. market, where the Omicron subvariants BA.4 and BA.5 are the most prevalent variants.

Novavax is also advancing its own Omicron-based COVID vaccine in clinical development. Management expects to initiate a regulatory filing with the FDA for this Omicron-specific vaccine candidate by 2022-end.

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