Valneva finally won its COVID-19 vaccine nod in Europe, but then officials slashed their purchase order

Even after winning a belated COVID-19 vaccine authorization in Europe, French vaccine biotech Valneva again finds itself with its back against the wall.

Valneva saw its shares tumble more than 15% in trading Wednesday in the wake of EU action that drastically cut the company’s contract to produce millions of COVID-19 doses.

The company has temporarily halted manufacture of the vaccine and will only pump more money into the product⁠—or its second-generation COVID shot⁠—if it can find new customers and funding in the coming months, Reuters reports.

After previously agreeing to purchase 60 million doses over a two-year period, European officials now plan to buy just 1.25 million doses. There's also an option under the deal for an additional 1.25 million doses.

“We feel the order volume does not reflect the interest we see from European citizens,” CEO Thomas Lingelbach, Valneva’s chief executive, told Bloomberg in a statement. “Despite this, we have decided to enter into this amendment. While the pandemic had been declining, the latest Covid-19 wave in Europe clearly underlines the need for alternative vaccines.” 

Analysts at Oddo BHF said that despite a strong cash position of $319 million in March—and the recent infusion of $93 million in capital by Pfizer to support the company’s prospective Lyme disease vaccine—Valneva is likely to cease its investment in VLA2001 or a second-generation COVID vaccine.

Shares of Valneva dipped to as low as $17.40 a share in late afternoon trading on the Nasdaq Wednesday. The stock ended the day at $18.56, down 13.2% from $21.38 recorded at the previous close. Shares traded as high as $67.28 in November.