Other vaccines are delivered via an injection, but Vaxart is trying to develop a tablet-based one.
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Far behind the pack of those racing to develop vaccines against Covid-19, the tiny start-up Vaxart has tried to stand out by pursuing a preventive delivered via a tablet, rather than a shot.
While front-runners like Moderna (ticker: MRNA) and the team of Pfizer (PFE) and BioNTech (BNTX) have won authorization for vaccines after Phase 3 controlled trials with tens of thousands of volunteers, Vaxart (VXRT) has been working through a Phase 1 study with 20 participants. Wednesday morning, Vaxart announced unimpressive results from that study, sending its stock down 50%, to $12.30. It went as low as $8.80 in the first moments of the trading day.
Without giving any numbers, Vaxart said that its vaccine appeared safe and had stirred up immune T-cells against the SARS-CoV-2 coronavirus, which causes Covid-19. “T-cells can provide long-lasting cross-reactive protection against current and emerging strains of the virus,” said the company’s science chief, Sean Tucker, in the press release.
But Vaxart said that two doses of its vaccine failed to induce neutralizing antibodies to the Covid virus. In the clinical trials of other vaccines, antibody levels correlated with protection against Covid symptoms.
In 15 years of operations, Vaxart has reported no product revenue and had run up a cumulative deficit of $135 million through September 2020. Hopes for its oral vaccine programs against Covid and influenza allowed it to raise capital, and it still had $133 million in cash on its September balance sheet.
But skepticism about the company’s prospects led to its stock becoming one of the most highly-shorted small-cap securities, as investors made short-sale bets that it would drop. Vaxart’s securities filings acknowledged that it is under investigation by the Securities and Exchange Commission and the Justice Department for having said in June that its product had been selected by the U.S. government’s Operation Warp Speed vaccine-development program.
Vaxart’s high short interest made it a focus of the past month’s short-squeeze campaign, in which traders were rallied on social media platforms like Reddit to push up highly-shorted stocks and force short sellers to lift the prices further as they bought shares to close out their losing bets.
From late December, Vaxart shares rose fourfold to a Tuesday peak just below $25, which valued the little start-up at more than $2.5 billion. After Wednesday’s disappointment, Vaxart has a market capitalization of $1.3 billion.
Write to Bill Alpert at [email protected]
