Novavax extends 2-day loss to 31% as the biotech firm delays seeking emergency authorization for its COVID-19 vaccine

• Novavax shares have lost as much as 31% since Monday after news about its potential COVID-19 vaccine.
• Novavax will now seek regulatory approval for its vaccine in the US, the UK and in Europe in the third quarter.
• The biotech company had previously projected potential US authorization in May.

Novavax shares on Tuesday sharply extended losses during a two-day rout after the biotech company delayed seeking approval for its COVID-19 vaccine from three regulators, including the Food and Drug Administration.

The shares came under pressure on Monday following a Washington Post report that the company would delay filing for emergency use authorization for its experimental coronavirus vaccine in the US until June at the earliest, because of manufacturing issues. During a Monday conference call, Novavax reportedly said it expects to submit its vaccine to regulators in the US, the UK and the European Union in the third quarter.

In March, Novavax CEO Stanley Erck said its coronavirus vaccine could be authorized in the US as soon as May.

Shares of Novavax on Tuesday fell as much as 24% to $121.74. The shares on Monday plunged 8.8% following the Washington Post's report about the potential delay.

Jefferies in a note Tuesday following Novavax's conference call said there not data as of yet has come from the company's phase 3 coronavirus study in the US, with Novavax anticipating top-line data before the end of the second quarter after modifying trial analysis protocol.

"Management remains confident in their ability to execute, and reiterated high demand for vaccine [worldwide] and the mid- to long-term opportunity that they have," said Jefferies equity analyst Kelechi Chikere in the note.

However, pushing out the authorization filings to the third quarter from the second, and a downward revision to time to full production to the fourth quarter from the third, represent delays to prior timelines "and difficulty in growing," Chikere wrote. Jefferies has a buy rating on Novavax and a price target of $310 per share.

Meanwhile, CFRA downgraded its rating on Novavax to "buy" from "strong buy" and cut its 12-month price target by $50 to $200.

"We know that we are delayed from where we thought we would be at this point," Novavax CEO Stanley Erck said during Monday's conference call, according to the Washington Post. "Now, we're giving guidance that nearly all of the major challenges have been overcome and we can clearly see the light at the end of the tunnel."