Novavax cheers topline RSV F vaccine retrial data, but investors aren’t buying it

Novavax sees topline data from another phase 2 trial on its RSV F vaccine as positive, but stock fell anyway.

After its RSV F vaccine candidate flunked a major phase 3 trial last September, Novavax has been trying to prove that it's not the shot that's the problem. The company sees hope in a new phase 2 trial, but topline results failed to restore confidence among investors.

The vaccine developer in January started a new phase 2 test in 300 subjects aged 60 or older to evaluate the candidate’s immunogenicity. This time, investigators carefully divided the subjects into 12 groups, giving them—except for the placebo arm—one or two shots of different doses of the vaccine. Some participants additionally received an aluminum adjuvant and some received the company’s Matrix-M adjuvant.

On Monday, Novavax touted topline data showing that two-dose regimens significantly increased immune responses to the highly contagious respiratory virus, especially when given with either one of the adjuvants twice. On a Monday call with analysts, CMO Louis Fries III said both the 120-mg vaccine plus aluminum adjuvant and the 135-mg vaccine plus Matrix-M worked well so far, and that investigators are awaiting six-month data to see which of these two formulations perform best in the long haul to cover an entire RSV season.

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“The totality of these immune effects surely makes the use of adjuvants desirable going forward, and we believe it’s likely to decrease the risk of next steps,” Fries said.

During the 80-minute call, Fries, together with CEO Stanley Erck and R&D chief Gregory Glenn, M.D., worked to convince investors that despite the failed phase 3 trial, the shot is still a promising product.

But the market response didn’t match up with the company’s optimism. Novavax shares dropped 19% post market, erasing any earlier gains from investor excitement before the announcement.

Last year, Novavax blamed a weak RSV season for the failed phase 3 trial, called Resolve, that tested the vaccine’s efficacy in 11,856 people 60 and older.

On Monday, company executives also touted a recent posthoc analysis of Resolve indicating the vaccine was associated with a 61% reduction in chronic obstructive pulmonary disease-related hospitalizations. Quoting data from the CDC, Erck said about 9.3 million U.S. adults over 55 years were diagnosed with COPD in 2013. Calling it a “highly motivated population,” Erck estimated the market opportunity with that group is about $1.5 billion globally, and the market for an RSV vaccine in general is valued at $6 billion, which Erck said his company is still targeting.

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Now, Novavax will have another chance to prove the vaccine’s efficacy as it plans to initiate a phase 2 efficacy trial in older adults next year. That study will likely look at COPD exacerbations as an endpoint.

In another large phase 3 trial called Prepare, researchers are examining the vaccine’s efficacy for infants via maternal immunization. That trial received $89 million support from the Bill and Melinda Gates Foundation.

Besides Novavax, AstraZeneca’s MedImmune and Bavarian Nordic are also developing RSV vaccines.