Shares in Novavax (NASDAQ:NVAX) plunged more than 80% on Friday after the company’s most advanced vaccine candidate failed to meet either of its primary or secondary objectives.
The company’s market capitalisation plummeted from US$2.2bn to just US$372mln this morning.
The final stage study of Novavax’s respiratory syncytial virus (RSV) vaccine “did not demonstrate vaccine efficacy” in the prevention of the virus.
In fact, slightly more patients on the vaccine had symptoms associated with RSV than those on the placebo.
“We are both surprised and disappointed by the outcome of the trial,” said research and development president Gregory Glenn.
“Our initial analyses and review of the key aspects of the trial do not indicate issues with trial execution, data collection, data integrity, or drug product quality.”
Glenn added that the company would analyse more data over the coming weeks to try to further its understanding of the result.
Novavax is still confident that “there is a path forward” for the vaccine despite the failure.
RSV kills around 14,000 adults in the US every year according to the US Centers for Disease Control and Prevention, and there are currently no approved vaccines to treat it.
Novavax shares jumped last year after it said a Phase II trial showed its vaccine was able to fend off the virus.
At the time, chief executive Stan Erck said he thought it would go on to be the world’s best-selling vaccine.
Novavax’s stock had gained more than 25% in the three months prior to the release of the trial results.
Shares were down US$7, or 84%, to US$1.32.