Sanofi will hand Novavax $500 million upfront for its COVID-19 vaccine, which it will co-commercialize and develop into a combination flu-COVID vaccine.
Sanofi announced a deal worth up to $1.4 billion with Novavax on Friday for its COVID-19 vaccine, giving the Maryland-based biotech a much-needed boost to its struggling business.
The French pharma is dropping $500 million upfront for Novavax’s COVID-19 vaccine, with the goals of co-commercializing its current formulation as well as developing a combination vaccine for COVID and flu. An additional $700 million is up for grabs in milestone payments. Along with another potential $200 million in milestones for additional vaccines made with Novavax’s Matrix adjuvant technology, deal totals $1.4 billion—more than double the biotech’s current market cap of $627 million.
Thanks to the infusion of cash, Novavax will be able to lift its prior warning to investors issued in February 2023 expressing doubts over its ability to stay in business, its CEO John Jacobs told CNBC News. The deal skyrocketed Novavax’s stock Friday morning in premarket trading, up 120% at one point. In February 2024, the stock had dropped over 25% after the biotech’s fourth quarter earnings missed estimates.
From Sanofi’s perspective, Head of Vaccines R&D Jean-Francois Toussaint emphasized the value of targeting COVID and flu with one shot. Sanofi has three mRNA candidates now in clinical testing for RSV, flu and a combination of the two. And already on the market are two quadrivalent influenza vaccines from the company, which has not yet been disclosed what shot will be combined with Novavax’s protein-based one.
“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,” Toussaint said in a statement.
In 2021, Sanofi dropped $3.2 billion on mRNA company Translate Bio to bolster its vaccine and therapeutic technologies.
As part of the deal, Sanofi is taking just under a 5% stake in Novavax.
Kate Goodwin is a freelance life science writer based in Des Moines, Iowa. She can be reached at kate.goodwin@biospace.com and on LinkedIn.
