Novavax signs licensing agreement with Pfizer for vaccine development

By Michael Erman and Christy Santhosh

Jan 20 (Reuters) – Novavax said on Tuesday it signed a licensing agreement allowing Pfizer access to its technology that boosts immune responses to vaccines for use in up to two infectious diseases, and the smaller company’s shares jumped nearly 7%.

Pfizer will gain access to Novavax’s Matrix-M adjuvant through the non-exclusive deal.

Novavax will receive an upfront payment of $30 million in the first quarter of 2026. It will be eligible to receive up to an additional $500 million if certain milestone are met as part of the deal, and receive tiered high mid-single-digit percentage royalties on quarterly net sales.

Pfizer will have control over all matters relating to the development, manufacture and commercialization of its products that contain the adjuvant, apart from the delivery and supply of Matrix-M, the company said.

Novavax CEO John Jacobs said in an interview that the Maryland-based company is receiving “multiples more” interest in Matrix-M from potential partners than at any time during his three years at the helm.

Vaccine adjuvants, which improve the body’s response to an inoculation, have received scrutiny from allies of U.S. Health Secretary and longtime anti-vaccine activist Robert F. Kennedy Jr. because many of them contain aluminum. Novavax’s adjuvant technology does not.

“That’s obviously been a significant topic of debate,” Novavax Chief Strategy Officer Elaine O’Hara said. “Our position is that we have a non-alum-based adjuvant that… is a very, very robust alternative for companies.”

Novavax has been facing investor pressure over sluggish sales of its COVID-19 vaccine, Nuvaxovid, as prescriptions declined following new, more restrictive U.S. recommendations for the shots.

In 2024, Novavax signed a licensing deal worth at least $1.2 billion with Sanofi that gave the French drugmaker access to its COVID-19 vaccine.

H.C. Wainwright analysts said the Pfizer deal value is generally in line with the Sanofi agreement and could “help secure the long-term future of Novavax” and lead to “more licenses this year.”

In November, Hedge fund Shah Capital, Novavax’s second-largest shareholder, called on the board to pursue strategic changes, including a potential sale, and warned it could launch a proxy fight if no progress is made in the next four months.

(Reporting by Michael Erman in New York and Christy Santhosh in Bengaluru; Editing by Shinjini Ganguli and Bill Berkrot)