A health worker prepares a dose of the Novavax vaccine as the Dutch Health Service Organization starts with the Novavax vaccination program on March 21, 2022 in The Hague, Netherlands.
Patrick Van Katwijk | Getty Images
Covid-19 vaccine maker Novavax on Tuesday raised doubts about its ability to remain in business and announced plans to slash spending as it works to prepare for a fall vaccination campaign.
The company said there is significant uncertainty around its 2023 revenue, funding from the U.S. government, and pending arbitration with global vaccine alliance GAVI. But its cash flow forecast indicates it has sufficient capital to fund operations over the next year.
The company lost $182 million, or $2.28 per share, in the fourth quarter on weaker-than-expected sales of $357 million. Analysts had expected sales of $383 million, according to Refinitiv data.
“If we execute on our operating plan, we’ll be in a very strong position not only at the end of this year, but going into next year,” Novavax’s new Chief Executive John Jacobs, who joined the company in late January, said in an interview. Novavax had $1.33 billion of cash on hand at the end of 2022.
However, Jacobs cautioned that there are risks in the near term to that operating plan, including the fact that protein-based vaccines like Novavax’s take longer to produce than their messenger RNA-based competitors.
Companies will need to change their vaccine each year to match circulating strains as required by regulatory agencies, including the U.S. Food and Drug Administration.
“We don’t know what the strain selection is yet from FDA. We don’t know what global health authorities may want from a regulatory standpoint on how the new vaccine needs to look,” Jacobs said. “The sooner we know that the more clarity we have on our path forward.”
The CEO said the company has been spending at a “hot rate,” and plans to cut back, likely including job cuts.
“We’re in the process of assessing the global footprint of Novavax,…
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