Stay at the forefront of the week’s champions and runners-up among publicly traded biotech companies and the reasons behind the ups or downs of their stock price fluctuations.

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Novavax (NVAX) learned how tough it is to tie its fortunes to COVID-19 after its stock sank 30% on Tuesday. Investors hurried to sell off their shares in the company after it slashed its total revenue forecast for this year by half on the low end and more on the high end, from between $4 billion and $5 billion to between $2 billion and $2.3 billion—a cut the company blamed on “several evolving market dynamics.”

Those dynamics, put simply, relate to demand for the company’s COVID-19 vaccine falling short of expectations. One key reason why was the time it took for Novavax to bring its Nuvaxovid™ vaccine to market, which at roughly two years was more than a year longer than either the Pfizer/BioNTech combination or Moderna needed to develop their messenger RNA (mRNA)-based COVID-19 vaccines and bring them into patients’ arms.

Novavax President and CEO Stanley C. Erck

“In the case of the U.S., I believe we were late to the market and U.S. vaccination was driven by what was available and shown to work: mRNA vaccines,” Novavax President and CEO Stanley C. Erck told analysts Monday afternoon on the company’s quarterly earnings call.

Novavax said it has delivered more than 73 million doses of Nuvaxovid worldwide—of which about one-third or 23 million were delivered since the start of the third quarter—numbers that according to the company reflect “strong momentum for the remainder of 2022.”

By comparison, Pfizer said 36 billion doses of its vaccine has been shipped to 180 countries and territories worldwide.

“We already had a view that demand wasn’t measuring up and that any prospects for additional orders late into the year were a little bit risky,” Max Nisen, an equity associate analyst at Bloomberg Intelligence, told Bloomberg News.

Roger Song, MD, MBA, CFA, an analyst with Jefferies, says he’s focusing more on Novavax’s future than its recent past.

“While we are disappointed about near-term performance and lower guidance, we are turning attention to ’23+ (likely commercial) market as NVAX clears various regulatory hurdles,” Song wrote in an investor note.

“2Qs big miss was a surprise to us,” Song added, since Novavax was able to convert 75% of its deliveries tracked at its distribution center into revenue recognized by the company during the first quarter

Investors, Song added, were reacting to five factors. One is renegotiation with Gavi, the Vaccine Alliance, due to lower-than-expected demand for vaccine doses. “After ongoing discussions with Gavi, we no longer expect to receive an order from the COVAX facility in 2022,” John Trizzino, Novavax Executive VP, Chief Commercial Officer and Chief Business Officer, said during the earnings call.

The other four factors:

  • Slower than expected administration of the company’s COVID-19 vaccines.
  • The expectation of quick availability for COVID-19 vaccines capable of preventing the Omicron variant and its various subvariants
  • A “general CV19 [COVID-19] perception” that vaccine uptake will not rise significantly going forward, and
  • Comments from other developers of COVID-19 vaccines experiencing slowing revenues.

Pfizer, for example, reported $8.848 billion in second-quarter revenue for COMIRNATY®, the COVID-19 vaccine it co-developed with BioNTech—40% of the $22.075 billion generated from direct sales and alliance revenues during the first half of this year (up 95% from a year ago). However, Pfizer last month reaffirmed its 2022 revenue guidance for COMIRNATY of $32 billion, accounting for one-third of the company’s total revenue guidance of between $98 billion and $102 billion.

Moderna recorded $4.531 billion in Q2 product sales, all of it from its COVID-19 vaccine, 43% of its total product sales of $10.456 billion during the first half of 2022. The company said it remains on track with its projection of around $21 billion of sales via advance purchase agreements. Year-over-year, Moderna saw its Q2 product sales jump 76%.

“We remain confident in our vaccine as a strong additional choice,” Novavax insisted in a statement. “Its competitive product profile includes our vaccine’s efficacy, well-tolerated safety profile, durability of protection, and ability to address both current and future variant strains.”

Those strengths don’t appear to hold as much sway with investors as they once did, judging from the share price. After declining 5% in Monday trading, from $60.27 to $57.25, the share price tumbled 30% in after-hours trading reaching $39.90 on Tuesday at 9:12 a.m., before finishing the day at $40.28. Shares rebounded slightly on Wednesday, rising about 3% to $41.36—a 71% plunge from its 2022 high of $142.90 on January 3, the year’s first trading day.

Atara Biotherapeutics (ATRA)

Shares of Atara jumped 29% on Tuesday, from $3.63 to $4.69, after the company announced plans to eliminate approximately 20% of its workforce in a restructuring designed to cut costs and extend its cash runway into the first quarter of 2024 by reducing its cash burn rate by more than 20%.

Those moves were part of a restructuring intended to refocus Atara on three R&D priorities: Clinical development of its Phase II progressive multiple sclerosis candidate ATA188; an IND filing for its allogeneic CD19 CAR T candidate ATA3219, designed to improve durable clinical response in hard-to-treat B-cell malignancies; and European Union and potential U.S. regulatory filings and approvals for Tabelecleucel® (tab-cel), a treatment for post-transplant lymphoproliferative disease (PTLD).

Pascal Touchon, Atara’s President and CEO, said the FDA had recommended a possible path towards a Biologics License Application (BLA) filing for tab-cel without the need for a new clinical study.

In the U.S., Atara plans to seek a commercial partner for tab-cel that would shoulder “all related activities and costs,” thus lengthening the company’s cash runway.

Atara shared potentially better news in Europe, saying that it anticipated European Commission (EC) approval of tab-cel in Q4 2022 after successfully completing all six pre-approval inspections required to support its Marketing Authorization Application (MAA) for the treatment. The European Medicines Agency (EMA) is on track with its review of tab-cel, Atara added.

CorMedix (CRMD)

CorMedix shares plunged 57% on Tuesday, from $7.52 to $3.20, after the company acknowledged that the FDA sent it a second Complete Response Letter (CRL) stating that its NDA for its lead pipeline candidate DefenCath™ cannot be approved until the agency is satisfied with how CorMedix addresses unspecified “deficiencies” that arose during inspections.

The deficiencies were conveyed by the FDA to its contract manufacturing organization (CMO) and supplier of the active pharmaceutical ingredient (API) heparin, CorMedix said. The company conceded that the deficiencies cannot be resolved before its FDA-issued Prescription Drug User Fee Act (PDUFA) target decision date, which CorMedix has only disclosed as following a six-month review cycle of DefenCath that began in March, after a second NDA was submitted.

DefenCath is an antibacterial and antifungal solution designed to prevent bloodstream infections associated with the use of central venous catheters in patients undergoing chronic hemodialysis.

To get its DefenCath application back on track CorMedix said, it has contracted with Alcami to transfer its manufacturing process for DefenCath into an Alcami site. As part of that process, CorMeix will also switch to an alternate supplier of heparin with which Alcami has navigated FDA cGMP inspections and won approvals.

CorMedix said it expected to submit a supplement to its NDA application “around the end of the first quarter of 2023.”

Mersana Therapeutics (MRSN)

Shares of Mersana rose 33% on Tuesday and jumped 47% between August 5 and Wednesday, after the antibody-drug conjugate (ADC) developer found a big-name partner in GlaxoSmithKline (GSK). Mersana has inked an up-to-$1.46 billion-plus collaboration with GSK, through which the Cambridge, MA, biotech has given the pharma giant an exclusive option to co-develop and commercialize XMT-2056, a cancer-fighting Immunosynthen ADC targeting a novel epitope of human epidermal growth factor receptor 2 (HER2).

XMT-2056 is designed to activate the innate immune system through stimulator of interferon genes (STING) signaling in both tumor-resident immune cells and tumor cells. Mersana says XMT-2056 has shown robust anti-tumor activity in preclinical models as a monotherapy in both HER2-high and HER2-low expressing models, with enhanced efficacy shown when dosed in combination with multiple drugs, including trastuzumab, pertuzumab, anti-PD-1, and trastuzumab deruxtecan.

Mersana said it expected to begin a Phase I trial of XMT-2056 that will evaluate its potential against HER2-expressing tumors such as breast, gastric and non-small-cell lung cancers. The FDA has granted XMT-2056 its orphan drug designation for the treatment of gastric cancer.

GSK—which seeks to expand its ADC portfolio beyond its marketed relapsed/refractory multiple myeloma treatment Blenrep® (belantamab mafodotin-blmf)—has agreed to pay Mersana an upfront option purchase fee of $100 million, and—should GSK exercise that option—up to $1.36 billion to consist of an option exercise payment and payments tied to achieving development, regulatory and commercial milestone.

“We believe this agreement solidifies Mersana’s position as a partner of choice during this momentous period in the ADC space and serves as validation for our Immunosynthen platform, which takes ADCs beyond the cytotoxic realm by enabling a targeted stimulation of the innate immune system,” Mersana President and CEO Anna Protopapas said in a statement.

Quanterix (QTRX)

Quanterix shares tumbled 57% on Tuesday, from $17.47 to $7.46, after the biomarker detection platform developer announced a restructuring and business realignment that will eliminate approximately 130 jobs, or more than one-quarter (28%) of the 460-person workforce it employed as of December 31, 2021, according to its most recent Form 10-K Annual Report, filed March 1. Quanterix said the restructuring was intended “to fully realize the potential of its SIMOA® platforms and continue its leadership role in ultrasensitive translational biomarker detection.”

The company said it expected to incur approximately $7 million to $10 million in restructuring and related charges to be taken in the third quarter. Quanterix also shrunk its revenue guidance for this year to flat revenue, saying it wouldn’t return to double-digit revenue increases until 2024.

The realignment followed a second quarter that ended with a net loss of $24.902 million, more than double the Q2 2021 net loss of $11.897 million, on revenue that fell 7.4% year-over-year, to an even $23.5 million. Quanterix blamed its revenue decline on reduced consumable revenue as it tackled assay quality challenges and efforts to improve its processes. Quanterix said underlying market demand for SIMOA “remains robust.”

“We are taking decisive action to focus and improve the quality and scalability of our products, support our customers and open the door to new growth opportunities,” Masoud Toloue, Quanterix’s President and CEO, said in a statement. “By embarking on this next chapter, we will emerge a stronger company, innovating at a faster pace and well-timed to enable new disease modifying therapies expected to come to market in the coming years.”

Quanterix also disclosed that its Executive Chairman E. Kevin Hrusovsky, whom Toloue succeeded as CEO in April, was leaving his position, to be succeeded by the board’s lead independent director Martin Madaus.

Verona Pharma (VRNA)

Verona shares jumped 63% early this week, to $10.90 on Wednesday from $6.70 at the close of trading August 5, after the company announced positive topline data Tuesday showing that its nebulized ensifentrine, a maintenance treatment for chronic obstructive pulmonary disease (COPD), aced the Phase III ENHANCE-2 trial (NCT04542057). Ensifentrine met the study’s primary endpoint of statistically significant change compared to placebo in average Forced Expiratory Volume in one second (FEV1) area under the curve 0-12 hours post dose at week 12 (94 mL).

Ensifentrine is a first-in-class, dual inhibitor of the enzymes phosphodiesterase 3 and 4 (PDE3 and PDE4) combining bronchodilator and anti-inflammatory activities in one compound. Verona aims to submit a New Drug Application (NDA) to the FDA in the first half of 2023, but that will hinge on achieving similarly positive results in its other Phase III trial, ENHANCE-1 (NCT04535986), which is on track to report data by year’s end.

“We view ensifentrine [as] well poised to capture a potentially multi-billion dollar opportunity (>1.2M target patients in the US), Jefferies analyst Suji Jeong, PhD, wrote to investors. “This translates to our peak sales estimates of ~$1.2B,” up from an earlier forecast of $800 million after Jeong raised her projection of ensifentrine’s peak patient penetration rate from five percent to seven percent.

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