Announces co-exclusive licensing agreement with Sanofi to co-commercialize COVID-19 vaccine, develop novel COVID-19-Influenza combination vaccines and develop multiple new vaccines utilizing Novavax's Matrix-MTM adjuvant This agreement represents a potential multi-billion dollar revenue opportunity for Novavax including: $500 million upfront payment Approximately $70 million equity investment in Novavax Up to $700 million in COVID-19 and combination product near-term milestones, plus ongoing tiered royalties on product sales Up to $200 million in milestones plus royalties for each new vaccine developed utilizing Novavax's Matrix-MTM adjuvant Announces addition of standalone influenza vaccine to Phase 3 COVID-19-Influenza Combination vaccine trial, which is on-track to initiate second half of 2024, with potential 2026 launch for both candidates Reduced current liabilities by an additional $831 million during Q1 2024 Achieved total revenue in Q1 2024 of $94 million Novavax removes going concern notice Company to host conference call today at 8:30 a.m. ET GAITHERSBURG, Md., May 10, 2024 /PRNewswire/ -- Novavax, Inc. (NASDAQ:NVAX), a global company advancing protein-based vaccines with its Matrix-M™ adjuvant, today announced its financial results and operational highlights for the first quarter ended March 31, 2024. Earlier today, Novavax and Sanofi (NASDAQ:SNY) announced that they have entered into a co-exclusive licensing agreement. The terms of the agreement include: a co-exclusive license to co-commercialize Novavax's current stand-alone adjuvanted COVID-19 vaccine worldwide (except in countries with existing Advance Purchase Agreements [APAs] and in India, Japan and South Korea where Novavax has existing partnership agreements); a sole license to Novavax's adjuvanted COVID-19 vaccine for use in combination with Sanofi's flu vaccines while Novavax retains the right to and is developing its own COVID-19-Influenza Combination (CIC) vaccine candidate; a non-exclusive license to use Novavax's adjuvanted COVID-19 vaccine for use in combination with non-flu vaccines; and a non-exclusive license to use the Matrix-M adjuvant in vaccine products. In addition, Sanofi will take a minority (<5%) equity investment in Novavax. "Today we announce the beginning of an exciting new chapter for Novavax with the launch of a strategically important partnership with one of the world's leading vaccine companies. We believe the combined strength of Novavax and Sanofi will enable us to better fulfill our mission of developing and improving access to life-saving vaccines," said John C. Jacobs, President and Chief Executive Officer, Novavax. "I am proud of the progress our Company has made this quarter as we continue to advance our COVID-19 vaccine for the upcoming 2024-2025 vaccination season and plan for the launch of our Phase 3 CIC and standalone influenza program in the second half of this year." The agreement is further validation of Novavax's technology platform and provides significant opportunity to drive value creation and benefit global public health. It strengthens Novavax's balance sheet and cash flow position, providing the opportunity to focus more on research and development and pipeline expansion to accelerate growth and generate long-term value for shareholders. Sanofi Agreement Highlights Financial Highlights This agreement represents a potential multi-billion dollar revenue opportunity for Novavax. The total value of near-term upfront payments, Sanofi's equity investment and potential milestones associated with Nuvaxovid™ sales and the development of Sanofi's flu-COVID-19 combination vaccine equate to approximately $1.3 billion. Novavax will receive an upfront payment of $500 million within 10 days. Novavax will receive today an equity investment of approximately $70 million in Novavax common stock for a 4.9% minority interest. Novavax is eligible to receive up to $350 million in milestones for activities related to Nuvaxovid. Novavax is eligible to receive up to $350 million in additional milestones for Sanofi's flu-COVID-19 combination vaccine. In addition, Novavax is eligible to receive royalties associated with the ongoing sales of Nuvaxovid and Sanofi's flu-COVID-19 combination vaccine and any other combination vaccines Sanofi may develop including Nuvaxovid. And finally, for each additional Sanofi vaccine product developed under the non-exclusive license with Novavax's Matrix-M adjuvant technology, Novavax is eligible to receive additional launch and sales milestones of up to $200 million per product plus ongoing product royalties. Additional Highlights Novavax is eligible for cost reimbursement by Sanofi of certain R&D and medical affairs costs, select technology transfer costs and supply of COVID-19 and Matrix-M adjuvant. Sanofi will be solely responsible for the development and commercialization of any novel flu-COVID-19 combination product containing a Sanofi flu vaccine, and any other combination products they may develop utilizing Nuvaxovid and any other new vaccines they develop utilizing the Matrix-M adjuvant. Outside of the collaboration, each party may develop and commercialize their own COVID-19-Influenza combination vaccines and adjuvanted products at their own cost. First Quarter 2024 and Recent Highlights During the first quarter, Novavax continued executing against its three key priorities for 2024. Priority #1: Deliver an Updated COVID-19 Vaccine for the 2024-2025 Vaccination Season U.S. Market: Updated protein-based COVID-19 vaccine to JN.1 with anticipated pre-filled syringe presentation. Completed the submission of the Biologics License Application for Novavax's COVID-19 vaccine with the U.S. Food and Drug Administration (FDA). Aligned with the FDA on pathway for Emergency Use Authorization for updated COVID-19 vaccine for the 2024-2025 vaccination season, with the intent of facilitating product availability at the beginning of the season. Advanced retail pharmacy contract negotiations for the 2024-2025 vaccination season. Global Markets: Delivered doses of Nuvaxovid XBB.1.5 vaccine to Europe and for distribution by the Taiwan Centers for Disease Control. Received marketing authorization from the United Kingdom's (U.K.) Medicines and Healthcare products Regulatory Agency for Nuvaxovid XBB.1.5 in individuals aged 12 and older in January and progressed preparations for participation in the U.K. spring campaign for private healthcare providers. Granted full approval from Singapore's Health Sciences Authority for Nuvaxovid XBB.1.5 for active immunization to prevent COVID-19 in individuals aged 12 and older. Priority #2: Launch Phase 3 trial of CIC and Stand-alone Influenza Program Novavax remained focused on leveraging its technology platform, including its proprietary Matrix-M adjuvant, to expand its pipeline with CIC and stand-alone influenza vaccine candidates. Made strategic decision to add a stand-alone influenza arm to the Phase 3 trial and to focus on individuals at higher risk by enrolling adults aged 60 and older for both the stand-alone influenza and CIC arms of the trial. On track to submit an investigational new drug application and initiate the pivotal Phase 3 trial for both CIC and stand-alone influenza vaccine candidates in the second half of 2024, with potential for accelerated approval and launch in 2026. Continued to optimize preclinical candidates, including a new approach to H5N1 pandemic bird flu vaccination, and expanded core technology for novel applications including mucosal vaccination and high-density nanoparticles. Priority #3: Continue Evolution of Novavax, Further Reducing Operating Expenses Novavax has made significant progress on its commitment to improve its financial position while maintaining the capabilities that support long-term value creation. On track with global restructuring and cost reduction plan, continued to transform the Company into a more lean and agile organization, with an approximately 50% reduction in combined R&D and SG&A expenses in the first quarter of 2024 compared to 2023. Since December 31, 2022, reduced current liabilities by $1.7 billion, including an additional $831 million reduction in the first quarter of 2024, primarily driven by the settlements with Gavi, the Vaccine Alliance and Fujifilm Diosynth Biotechnologies. First Quarter 2024 Financial Results Total revenue for the first quarter of 2024 was $94 million, compared to $81 million in the same period in 2023. Cost of sales for the first quarter of 2024 was $59 million, compared to $34 million in the same period in 2023. These quarters included $15 million and $25 million, respectively, related to excess, obsolete or expired ...