Novavax and Sanofi Announce Co-exclusive Licensing Agreement to Co-commercialize COVID-19 Vaccine and Develop Novel COVID-19-Influenza Combination Vaccines
Novavax and Sanofi have entered into a co-exclusive licensing agreement to co-commercialize a protein-based COVID-19 vaccine and develop novel COVID-19-Influenza combination vaccines. The agreement provides broader access to the vaccine from 2025 onwards and includes a cash and equity investment of approximately $1.2 billion for Novavax. This collaboration aims to accelerate the development of a combination product based on authorized vaccines for enhanced convenience and protection.
Novavax secures cash and equity investment of $1.2 billion through the agreement with Sanofi.
The collaboration provides broader access to a protein-based COVID-19 vaccine and potential development of novel combination vaccines.
The partnership accelerates the potential for a COVID-19-Influenza combination product, enhancing convenience and protection for individuals.
Sanofi will solely be responsible for the development and commercialization of any novel flu-COVID-19 combination vaccine containing a Sanofi flu vaccine.
Both parties may develop and commercialize their own COVID-19-Influenza combination vaccines and adjuvanted products at their own cost outside of the collaboration.
Insights
The licensing agreement between Novavax and Sanofi marks a significant strategic maneuver, particularly for Novavax which stands to receive approximately
An important financial consideration here is the royalty structure. Novavax will benefit from tiered double-digit royalty payments on Sanofi's sales of the COVID-19 vaccines, which could result in a sustained revenue stream, contingent on market performance and uptake of the vaccine. This could be especially relevant as the companies aim to capitalize on demand for non-mRNA options.
From an investor's standpoint, the anticipation of additional launch and sales milestones – potentially up to
The market for COVID-19 vaccines is volatile and subject to rapid change as the pandemic evolves and new variants emerge. Thus, while the agreement seems to bolster Novavax's financial position in the short term, the long-term benefits hinge on several factors including vaccine efficacy, regulatory approvals, market demand and the course of the pandemic.
From a medical research perspective, the fusion of Novavax's recombinant protein-based vaccine with Sanofi's flu vaccine technology could be a game-changer, potentially offering enhanced protection against two prevalent respiratory illnesses. The focus is on offering a non-mRNA option, which could be appealing to certain demographics, addressing vaccine hesitancy linked to novel mRNA technologies.
The development of a COVID-19-Influenza combination vaccine represents an ambitious innovation, aligning with public health strategies to streamline vaccination programs and boost overall immunization rates. While the clinical benefit is evident, the success of such a combination vaccine will hinge on demonstrating superior efficacy and tolerability in comparison to existing vaccination options.
For the investor tracking the pharmaceutical and biotech sectors, the progress of the combination vaccine's development is a critical indicator to monitor. Accelerated R&D processes may lead to expedited access to advanced vaccine regimens, with the potential to capture a significant market share if proven effective.
Entering the market in 2025, the co-commercialized Novavax vaccine will be competing in an already crowded space. However, the value proposition of a protein-based non-mRNA adjuvanted vaccine could potentially open new market segments averse to mRNA vaccines. Market differentiation will be important for adoption rates.
The scope of the agreement also positions Novavax favorably for future vaccine development, leveraging its Matrix-M adjuvant technology. The adjuvant's applicability to other vaccine candidates could expand Novavax's market reach beyond the immediate COVID-19 and Influenza segments. For Sanofi, this move could signify an aim to secure a leadership position in the combined vaccine market, forecasted to grow as dual threats persist.
Investors should note the risk related to market demand fluctuations, especially as COVID-19 becomes endemic and the competitive landscape shifts. The durability of vaccine-induced immunity and global health policies will significantly influence long-term sales and market share.
- Agreement provides individuals with broader access to a protein-based non-mRNA adjuvanted COVID-19 vaccine through combined commercial strength, from 2025 onwards
- Provides Novavax with cash and an equity investment totalling approximately
$1.2 billion $500 million $700 million - Novavax is entitled to additional launch and sales milestone opportunities of up to
$200 million - Accelerates potential for development of a novel COVID-19-Influenza combination product based on authorized vaccines with demonstrated efficacy and tolerability, potentially offering individuals enhanced convenience and protection
The terms of the agreement include: a co-exclusive license to co-commercialize Novavax's current stand-alone adjuvanted COVID-19 vaccine worldwide (except in countries with existing Advance Purchase Agreements and in
"With flu and COVID-19 hospital admission rates now closely mirroring each other, we have an opportunity to develop non-mRNA flu-COVID-19 combination vaccines, offering patients both enhanced convenience and protection against two serious respiratory viruses," said Jean-Francois Toussaint, Global Head of Vaccines R&D, Sanofi. "We're excited by the prospect of combining Novavax's adjuvanted COVID-19 vaccine that has shown high efficacy and favorable tolerability, with our rich portfolio of differentiated flu vaccines that have demonstrated superior protection against flu and its serious complications. Improved tolerability and thermostability, without compromise on efficacy, are what regulators, recommending bodies and patients will demand."
"This collaboration is important for Novavax and for global public health. Our new partnership combines Novavax's proprietary recombinant protein and nanoparticle technologies, Matrix™ adjuvant and R&D expertise with Sanofi's world-class leadership in launching and commercializing innovative vaccines. Together, we can broaden access to both our COVID-19 vaccine and our adjuvant to ensure more individuals can benefit from the protection vaccines can provide," said John C. Jacobs, President and Chief Executive Officer, Novavax. "Novavax is now in a stronger position to refocus our efforts on leveraging our technology platform and novel adjuvant in R&D and pipeline expansion to help advance our mission of developing life-saving vaccines to fight infectious diseases."
Under the terms of the licensing agreement:
- Novavax will receive an upfront payment of
$500 million $700 million $1.2 billion - Starting in 2025, Sanofi will book sales of Novavax's adjuvanted COVID-19 vaccine and will support certain R&D, regulatory and commercial expenses.
- Novavax will receive tiered double-digit percentage royalty payments on sales by Sanofi of COVID-19 vaccines and COVID-19-Influenza Combination vaccines.
- Sanofi will be solely responsible for development and commercialization of any novel flu-COVID-19 combination vaccine containing a Sanofi flu vaccine.
- Outside of the collaboration, each party may develop and commercialize their own COVID-19-Influenza combination vaccines and adjuvanted products at their own cost.
- Novavax is entitled to additional launch and sales milestone opportunities of up to
$200 million - In addition, Sanofi will take a minority (<
5% ) equity investment in Novavax.
PJT Partners is acting as the exclusive financial advisor to Novavax. Ropes & Gray LLP is serving as legal advisor.
About Novavax
Novavax, Inc. (Nasdaq: NVAX) promotes improved health by discovering, developing and commercializing innovative vaccines to help protect against serious infectious diseases. Novavax, a global company based in
About Sanofi
We are an innovative global healthcare company, driven by one purpose: we chase the miracles of science to improve people's lives. Our team, across the world, is dedicated to transforming the practice of medicine by working to turn the impossible into the possible. We provide potentially life-changing treatment options and life-saving vaccine protection to millions of people globally, while putting sustainability and social responsibility at the center of our ambitions.
Forward-Looking Statements
Statements herein relating to enhanced access to a protein-based non-mRNA adjuvanted COVID-19 from 2025 onwards, development of COVID-19 combination vaccines (including COVID-19-Influenza combination vaccines), launching a phase 3 trial for Novavax's COVID-19-Influenza Combination vaccine candidate in the second half of 2024, future vaccines made with Novavax's proprietary Matrix-MTM adjuvant, potential royalties and milestones, the future of Novavax and its mission are forward-looking statements. Novavax cautions that these forward-looking statements are subject to numerous risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such statements. These risks and uncertainties include, without limitation, Novavax's and Sanofi's ability to successfully implement its partnership, including the ability to transition key processes and effect technology transfers; Novavax's ability to successfully and timely manufacture, distribute, or market its updated COVID-19 vaccine including as a single dose vial or pre-filled syringe product presentation for the 2024-2025 vaccination season; challenges satisfying, alone or together with partners, various safety, efficacy, and product characterization requirements, including those related to process qualification, assay validation and stability testing, necessary to satisfy applicable regulatory authorities; challenges or delays in conducting clinical trials; challenges or delays in obtaining regulatory authorization for its product candidates, including its updated COVID-19 vaccine in time for the 2024-2025 vaccination season or for future COVID-19 variant strain changes, its COVID-19-Influenza Combination vaccine candidate and its stand-alone influenza vaccine candidate; manufacturing, distribution or export delays or challenges; Novavax's substantial dependence on Serum Institute of India Pvt. Ltd. and Serum Life Sciences Limited for co-formulation and filling and PCI Pharma Services for finishing Novavax's COVID-19 vaccine and the impact of any delays or disruptions in their operations on the delivery of customer orders; difficulty obtaining scarce raw materials and supplies; resource constraints, including human capital and manufacturing capacity, constraints on Novavax's ability to pursue planned regulatory pathways, alone or with partners, in multiple jurisdictions simultaneously, leading to staggering of regulatory filings, and potential regulatory actions; challenges in implementing its global restructuring and cost reduction plan; Novavax's ability to timely deliver doses; challenges in obtaining commercial adoption and market acceptance of its updated COVID-19 vaccine or any COVID-19 variant strain containing formulation; challenges meeting contractual requirements under agreements with multiple commercial, governmental, and other entities, including requirements to deliver doses that may require Novavax to refund portions of upfront and other payments previously received or result in reduced future payments pursuant to such agreements; challenges related to the seasonality of vaccinations against COVID-19; and those other risk factors identified in the "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" sections of Novavax's Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the Securities and Exchange Commission (SEC). We caution investors not to place considerable reliance on forward-looking statements contained in this press release. You are encouraged to read our filings with the SEC, available at www.sec.gov and www.novavax.com, for a discussion of these and other risks and uncertainties. The forward-looking statements in this press release speak only as of the date of this document, and we undertake no obligation to update or revise any of the statements. Our business is subject to substantial risks and uncertainties, including those referenced above. Investors, potential investors, and others should give careful consideration to these risks and uncertainties.
Contacts:
Investors
Erika Schultz
240-268-2022
ir@novavax.com
Media
Giovanna Chandler
240-720-7804
media@novavax.com
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