Novavax Signs Multibillion-Dollar Deal with Sanofi for Co-Commercialization of Covid Vaccine and Combination Shots

Novavax, a struggling vaccine maker, has signed a multibillion-dollar deal with French drugmaker Sanofi to co-commercialize Novavax’s Covid vaccine and develop combination shots targeting both the coronavirus and the flu. This partnership marks a turning point for Novavax, as it allows the company to lift its previous “going concern” warning. Novavax’s shares saw a spike of 120% in premarket trading following the announcement of the deal. Health officials view Novavax’s protein-based Covid shot as a valuable alternative for individuals who are hesitant to take messenger RNA vaccines from Pfizer and Moderna.

Under the agreement, Sanofi will pay Novavax an upfront payment of $500 million, as well as up to $700 million for development, regulatory, and launch milestones. This amount is nearly double Novavax’s current market cap. Additionally, Novavax is entitled to royalty payments on Sanofi’s sales of its Covid vaccine and combination shots, along with launch and sales milestone payments of up to $200 million for each product developed with Novavax’s Matrix-M adjuvant.

Novavax CEO John Jacobs expressed his optimism about the deal, stating that it helps their business by providing capital and allowing them to pivot their strategy towards what they do best. He also emphasized that the partnership with Sanofi enables Novavax to fulfill its mission of improving global public health at a larger scale due to the lack of resources, capital, and scope if they were to go it alone.

The terms of the deal outline that Novavax will lead the commercialization of its Covid shot throughout this year and gradually transfer that responsibility to Sanofi in 2025. However, Sanofi will not oversee commercialization in countries where Novavax already has existing partnership agreements or advanced Covid vaccine purchase agreements. Jacobs believes that with Sanofi’s involvement, the market share and patient access to Novavax’s Covid vaccine will expand significantly.

This collaboration also allows Sanofi to develop combination shots that include its flu vaccine alongside Novavax’s Covid shot. Sanofi can also utilize Novavax’s Matrix-M adjuvant to create new vaccine products. Notably, Sanofi will be solely responsible for the development and commercialization of any combination shot containing its flu vaccine and Novavax’s Covid shot. Jacobs expressed his belief that this partnership with Sanofi, a world leader in commercialization and development, greatly increases the opportunity to bring multiple new vaccines to market more quickly.

In addition to the deal with Sanofi, Novavax plans to start a late-stage trial on its own combination vaccine targeting Covid and the flu, as well as a stand-alone flu shot later this year. Previously, Novavax had only planned to include the combination vaccine in the trial. This expansion of their pipeline is made possible by the resources freed up through the partnership with Sanofi.

In conclusion, Novavax’s collaboration with Sanofi represents a significant milestone for the struggling vaccine maker. The deal not only provides much-needed capital but also allows Novavax to leverage Sanofi’s expertise in commercialization and development. By expanding their vaccine offerings and reaching a broader patient base, Novavax is well-positioned to make a greater impact on global public health.