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Novavax (NVAX) stock jumped again yesterday after it received a $4 million award to be pumped into developing a vaccine for COVID-19. However, today it is falling.
Since the coronavirus epidemic worsened, the stock market has been a lot more unreliable than ever. Stocks that had shown a lot of promise since the year began, have crashed considerably and are still bleeding. There are a few stocks that seem to be well-positioned for an increase if the epidemic continues to get worse. However, of them all, biotech stocks are probably in the best position. Novavax Inc (NASDAQ: NVAX) stock is one that has enjoyed a rise on positive COVID-19 news for the company.
Novavax Stock Is on Rise
Maryland-based American vaccine company Novavax is one of the biotech firms currently working on tackling the new coronavirus COVID-19 strain. The company recently announced that it is making significant progress with COVID-19 and will soon start human trials.
To pump NVAX even more, the Coalition for Epidemic Preparedness (CEPI) announced a $4 million award to Novavax. In response to this news, Novavax stock spiked. Shortly after the opening bell yesterday, the price jumped 17%.
NVAX eventually closed up 6.29% for the day, at $10.65. Premarket trading currently shows a further 0.08% increase, hitting $10.66. At the time of writing, the stock is falling around 2%.
Novavax (NVAX) Stock Chances
It might be important to note that the funds might not do a lot for the company in the long run. In the grand scheme of things, $4 million might not significantly improve Novavax’s chances at completing research faster than competitors. However, the funds are a big plus for the company and will help further its research.
Reports also suggest that Novavax is still going over certain terms with CEPI. There is a possibility that CEPI will release more funds. According to CEO Stanley Erck:
“This first stage of funding from CEPI is critical to enable ongoing development of our COVID-19 vaccine candidates.”
At this rate, Novavax stock is quite well poised. The company has pulled in over 45% in the last one month and more than 167% in 2020 gains. While this is quite commendable, it is, however, a long way off the 302% gains it hit, just a few days ago.
Novavax is just one of a few companies working on a vaccine. Others include Gilead Sciences Inc (GILD), Regeneron Pharmaceuticals Inc (NASDAQ: RGN), Inovio Pharmaceuticals Inc (NASDAQ: INO) and a few others. Their work on COVID-19 initially did breathe some life into these companies and their stock. However, in recent times, they have lost a huge chunk of their weight.
According to a few market analysts, these biotech stocks might be losing steam because people are now quite worried about whether or not they’ll reach any success soon. That aside, there is also the worry about the price of the treatment, whenever it is ready.
In the past, biotech companies gained some weight during other outbreaks, simply on the possibility that they could find a solution.
Worldwide, the total number of confirmed cases is now over 118,000 with the number of deaths already nearing 5,000. A South China Morning report says that Chinese health officials are hopeful a vaccine will be ready in April. However, this vaccine will only be used for specific emergencies and clinical trials. It might still be a long time before authorities approve it for public use.