Novavax Inc.
11/06/2025 | Press release | Distributed by Public on 11/06/2025 06:48
Quarterly Report for Quarter Ending September 30, 2025 (Form 10-Q)
Management's Discussion and Analysis of Financial Condition and Results of Operations
Cautionary Note Regarding Forward-Looking Statements
This Quarterly Report on Form 10-Q (this "Quarterly Report") contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in Section 27A of the Securities Act of 1933, as amended (the "Securities Act") and Section 21E of the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Any statements in the discussion below and elsewhere in this Quarterly Report about expectations, beliefs, plans, objectives, assumptions, or future events or performance of Novavax, Inc. ("Novavax," together with its wholly owned subsidiaries, the "Company," "we," or "us") are not historical facts and are forward-looking statements. Such forward-looking statements include, without limitation, statements about our capabilities, goals, expectations regarding future revenue and expense levels, and capital raising activities; our strategic priorities, our corporate growth strategy, including our early-stage pipeline and research and development ("R&D") investment strategy and key value drivers; our technology platform; our COVID-19 program (our "COVID-19 Program") (which currently includes our Nuvaxovid prototype COVID-19 Vaccine ("NVX-CoV2373" or "prototype COVID-19 Vaccine"), our Nuvaxovid COVID-19 vaccine for the 2023-2024 vaccination season ("NVX-CoV2601") and our Nuvaxovid updated COVID-19 vaccine for the 2024-2025 vaccination season ("NVX-CoV2705" or "updated COVID-19 Vaccine"), collectively referred to as our "COVID-19 Vaccine"; our operating plans and prospects, including our ability to continue as a going concern through one year from the date of our unaudited financial statements for the period ended September 30, 2025 are issued; the implementation and anticipated impact of our global restructuring and cost reduction plan ("Restructuring Plan"), which includes a more focused investment in our COVID-19 Program; our cash flow forecast and projected revenue, including potential royalties and milestones pursuant to our collaboration and license agreement (the "Sanofi CLA") with Sanofi Pasteur Inc. ("Sanofi") and our other license agreements; potential market sizes and demand for our products and product candidates; the efficacy, safety, and intended utilization of our products and product candidates; the development of our clinical-stage product candidates and our recombinant vaccine and adjuvant technologies; the development of our preclinical product candidates; our expectations related to enrollment in our clinical trials; the conduct, timing, and potential results from clinical trials and other preclinical studies; plans for and potential timing of future and pending regulatory filings and actions; our ability to successfully conduct our postmarketing commitment ("PMC") study requested by the U.S. Food and Drug Administration ("U.S. FDA") following the U.S. FDA's approval of the Biologics License Application ("BLA") for our COVID-19 Vaccine; our expectation of manufacturing capacity, timing, production, distribution, and delivery for our COVID-19 Vaccine by us and our partners, including our anticipated timing of the U.S. FDA's approval of our BLA supplement to extend the shelf life of our COVID-19 vaccine; our expectations with respect to the anticipated ongoing development and commercialization or licensure of the COVID-19 Vaccine; our expectations with respect to the anticipated ongoing development of COVID-19 variant strain-containing monovalent or bivalent formulations, including the Phase 2b/3 Hummingbird™ trial, and our COVID-19-Influenza ("CIC") vaccine candidate and our stand-alone influenza vaccine candidate including partnership efforts for our CIC vaccine candidate and stand-alone influenza vaccine candidate to advance towards a BLA filing and commercialization; efforts to expand the COVID-19 Vaccine label worldwide as a booster, and to various age groups and geographic locations; the expected timing, content, and outcomes of regulatory actions; funding under our advance purchase agreements ("APAs") and supply agreements and amendments to, termination of, discussion regarding, or legal disputes relating to any such agreement; our available cash resources and usage and the availability of financing generally; plans regarding partnering activities and business development initiatives; our plans regarding APA amendments; and other matters referenced herein. Generally, forward-looking statements can be identified through the use of words or phrases such as "believe," "may," "could," "will," "would," "possible," "can," "estimate," "continue," "ongoing," "consider," "anticipate," "intend," "seek," "plan," "project," "expect," "should," "would," "aim," or "assume," the negative of these terms, or other comparable terminology, although not all forward-looking statements contain these words.
Forward-looking statements are neither historical facts nor assurances of future performance. Instead, they are based only on our current beliefs and expectations about the future of our business, future plans and strategies, projections, anticipated events and trends, the economy, and other future conditions. Forward-looking statements involve estimates, assumptions, risks, and uncertainties that could cause actual results or outcomes to differ materially from those expressed or implied in any forward-looking statements, and, therefore, you should not place considerable reliance on any such forward-looking statements. Such risks and uncertainties include, without limitation, our ability to successfully and timely obtain and maintain full U.S. FDA licensure or foreign regulatory approvals necessary to manufacture, market, distribute, or deliver our COVID-19 Vaccine; the impact of delays in obtaining regulatory approval, including regulatory decisions impacting labeling, approval or authorization, including the scope of the indicated population, product dosage, manufacturing processes, shelf life, safety, for our product candidates; challenges in conducting the PMC study, our ability to obtain adequate additional funding to maintain our current level of operations and fund the further development of our vaccine candidates; challenges related to our partnership with Sanofi, including collaboration on the PMC, and in pursuing additional partnership opportunities; challenges satisfying, alone or together with partners, various safety, efficacy, and product characterization requirements, including those related to
process qualification, assay validation, and stability testing, necessary to satisfy applicable regulatory authorities; challenges or delays in conducting clinical trials or studies for our product candidates; manufacturing, distribution or export delays or challenges; our substantial dependence on Serum Institute of India Pvt. Ltd. ("SII") and Serum Life Sciences Limited ("SLS" and together with SII, "Serum") for co-formulation and filling our COVID-19 Vaccine and the impact of any delays or disruptions in their operations; the impact of potential legislative, regulatory, or policy changes under the current presidential administration, including any adverse impact funding for vaccine research and development, reimbursement for vaccines and their administration, vaccine mandates and recommendations, and public perception of vaccine importance; uncertainty with respect to pricing, third-party reimbursement and healthcare reform; uncertainty in the regulatory pathway for our COVID -19 Vaccine; the impact of any new or changes in interpretations of existing trade measures, including tariffs, embargoes, sanctions, import restrictions, and export licensing requirements; difficulty obtaining scarce raw materials and supplies, including for our proprietary adjuvant; resource constraints, including human capital and manufacturing capacity, constraints on our ability to pursue planned regulatory pathways, alone or with partners, in multiple jurisdictions simultaneously, leading to staggering of regulatory filings, and potential regulatory actions; our ability to timely deliver doses; challenges in obtaining commercial adoption and market acceptance of our COVID-19 Vaccine or any COVID-19 variant strain containing formulation, or our CIC vaccine candidates, stand-alone influenza vaccine candidates or other candidates; challenges meeting contractual requirements under agreements with multiple commercial, governmental, and other entities including requirements to deliver doses that may require us to refund portions of upfront and other payments previously received or result in reduced future payments pursuant to such agreements; challenges related to the seasonality of vaccinations against COVID-19; challenges related to the demand for vaccinations against COVID-19 or influenza; challenges in identifying and successfully pursuing innovation expansion opportunities; our expectation as to expenses and cash needs may prove not to be correct for reasons such as changes in plans or actual events being different than our assumptions, and other risks and uncertainties identified in Part I, Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2024, and this Quarterly Report on Form 10-Q, which may be detailed and modified or updated in other documents filed with the Securities and Exchange Commission ("SEC") from time to time, and are available at www.sec.gov and at www.novavax.com. You are encouraged to read these filings as they are made.
We cannot guarantee future results, events, level of activity, performance, or achievement. Any or all of our forward-looking statements in this Quarterly Report may turn out to be inaccurate or materially different from actual results. Further, any forward-looking statement speaks only as of the date when it is made, and we undertake no obligation to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, unless required by law. New factors emerge from time to time, and it is not possible for us to predict which factors will arise. In addition, we cannot assess the impact of each factor on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements.
Overview
We are a company tackling global health challenges through scientific innovation that seeks to maximize our deep scientific expertise in vaccines and our cutting-edge technology platform. The differentiated platform features our recombinant protein-based nanoparticle technology and unique Matrix-M adjuvant. Our three strategic priorities are: focusing on our partnership with Sanofi announced in May 2024, enhancing existing partnership and leveraging our technology platform and pipeline to forge additional partnerships, and advancing our proven technology platform and early-stage pipeline. Our corporate growth strategy is supported by a lean, agile, and focused operating model.
Our technology platform, combined with our deep vaccine expertise, is the fuel for innovation and partnerships and we believe it has the potential to create significant value. Our proprietary Matrix-M adjuvant, when added to vaccines, has been shown to help induce a strong and long-lasting immune response. Our recombinant protein-based nanoparticle technology has been shown to be highly immunogenetic. Together, we believe that our technology platform can induce potent, durable and broad immune responses, with the potential to be antigen-sparing. Our Matrix-M adjuvant can increase both antibody and cell-mediated immune responses in vaccines and it has demonstrated a favorable tolerability profile in clinical trials. Our technology platform is used in our authorized COVID-19 Vaccine and the R21/Matrix-M adjuvant malaria vaccine.
In May 2024, we entered into a CLA with Sanofi, to co-commercialize our COVID-19 Vaccine, including future updated versions that address seasonal COVID-19 variants. Sanofi has the right to develop novel influenza-COVID-19 combination vaccines utilizing our COVID-19 Vaccine and Sanofi's seasonal influenza vaccine, combination products containing our COVID-19 Vaccine and one or more non-influenza vaccines, and multiple new vaccines utilizing our Matrix-M adjuvant. In December 2024, Sanofi announced that the U.S. FDA granted Fast Track designation to two Sanofi combination vaccine candidates: the first combination consists of Fluzone High-DoseTMcombined with our COVID-19 Vaccine, and the second combination consists of FlublokTMwith our COVID-19 Vaccine. Sanofi is evaluating the safety and immunogenicity of both combination vaccine candidates in two separate Phase 1/2 trials. We are eligible to receive royalties and milestones
associated with the ongoing sales of our COVID-19 Vaccine and Sanofi's influenza-COVID-19 combination vaccines and any other combination vaccines Sanofi may develop, as well as ongoing product royalties for vaccines developed with our Matrix-M adjuvant. We discuss this agreement in further detail in Note 6 to our accompanying unaudited consolidated financial statements.
Additionally, we are advancing our pipeline of both late- and early-stage programs with a focus on potentially high-value assets in areas with unmet medical need, compelling scientific rationale and strong commercial opportunity.
Our late-stage programs include a CIC vaccine candidate, as well as a stand-alone influenza vaccine candidate. In June 2025, we reported data from the initial cohort of a Phase 3 trial comparing our CIC vaccine and stand-alone influenza vaccine to our updated COVID-19 Vaccine and a licensed seasonal influenza vaccine comparator in adults aged 65 and older, which showed both vaccine candidates induced robust immune responses across all antigens tested. Both vaccine candidates were well tolerated and saw reactogenicity comparable to authorized comparators. We intend to partner these vaccine candidates to advance further development.
Furthermore, we provide our Matrix-M adjuvant for use in collaborations. These include the R21/Matrix-M adjuvant malaria vaccine, a malaria vaccine developed by our partner, the Jenner Institute, University of Oxford ("R21/Matrix-M adjuvant malaria vaccine") and manufactured by SII. R21/Matrix-M adjuvant malaria vaccine is authorized in several countries. Additionally, we provide Matrix-M adjuvant for use in various programs in preclinical and clinical stage, as well as preclinical investigations. Examples include, an agreement with the Gates Foundation, two material transfer agreements with leading pharmaceutical companies for exploration of Matrix-M adjuvant used as a potential advancement in their pipeline, and a third material transfer agreement to explore Matrix M in a pre-clinical collaboration in oncology.
We continue to advance our early-stage pipeline. We intend to develop our early-stage pipeline using a disciplined and capital-efficient approach. Our R&D investment strategy seeks to place targeted investments on the programs with the highest potential value, both within infectious disease and beyond, with the intent of partnering these programs at proof of concept. We would consider advancing a program ourselves where data and commercial landscape indicate a unique high-value opportunity. We are pursuing early-stage research in diseases such as, respiratory syncytial virus ("RSV") combinations, varicella-zoster virus ("Shingles") and Clostridioides difficile ("C. Diff.") colitis. We are actively working to evaluate several RSV combination candidates to progress forward toward an Investigational New Drug ("IND"). We are actively developing a pandemic influenza vaccine candidate and the toxicology study is underway. We are pursuing funding opportunities to join preparedness options. Additionally, we are evaluating potential expansion beyond infectious diseases, where we believe our technology could augment and improve upon current therapies.
Technology Overview
We believe our recombinant nanoparticle vaccine technology and our proprietary Matrix-M adjuvant are well suited for the development and commercialization of vaccine candidates targeting areas both within and beyond the infectious disease space.
Recombinant Nanoparticle Vaccine Technology
Once a target of interest has been identified, the genetic sequence encoding an antigen is selected for developing the vaccine construct. The genetic sequence may be optimized to enhance protein stability or confer resistance to degradation. This genetic construct is inserted into the baculovirus Spodoptera frugiperda ("Sf-/BV") insect cell-expression system, which enables efficient, large-scale expression of the optimized protein. The Sf-/BV system produces protein-based antigens that are properly folded and modified, which can be critical for functional, protective immunity. Our testing shows this results in a highly immunogenic nanoparticle that is ready to be formulated with Matrix-M adjuvant.
Matrix-M Adjuvant®
Our proprietary Matrix-M adjuvant is a key differentiator within our platform. This adjuvant has enabled potent, well tolerated, and durable efficacy by stimulating the entry of antigen presenting cells ("APCs") into the injection site and enhancing antigen presentation in local lymph nodes. This in turn activates APCs, T-cell and B-cell populations, and plasma cells, which promote the production of high affinity antibodies, an immune boosting response. This potent mechanism of action enables a lower dose of antigen to achieve the desired immune response, thereby contributing to increased vaccine supply and manufacturing capacity. These immune-boosting and dose-sparing capabilities contribute to the adjuvant's highly unique profile.
We continue to evaluate commercial opportunities for the use of our Matrix-M adjuvant alongside vaccine antigens produced by other manufacturers. Matrix-M adjuvant is being evaluated in combination with several partner-led malaria vaccine candidates, including for R21/Matrix-M adjuvant malaria vaccine. The R21/Matrix-M adjuvant malaria vaccine has been licensed to SII for commercialization. In May 2024, pursuant to the Sanofi CLA, Sanofi received a non-exclusive license to develop and commercialize other vaccine products that include our Matrix-M adjuvant. In September 2024, we signed a Matrix-M adjuvant related agreement with a leading pharmaceutical company to enable exploration of our technology for the potential advancement of their pipeline candidates. In the first quarter of 2025, we signed two additional material transfer agreements to explore the use of Matrix-M adjuvant.
COVID-19 Vaccine Regulatory and Licensure
In May 2025, the U.S. FDA approved the BLA for Nuvaxovid for active immunization to prevent COVID-19 caused by severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2) in adults 65 years and older and individuals 12 through 64 years who have at least one underlying condition that puts them at high risk for severe outcomes from COVID-19 (e.g. asthma, cancer, diabetes, obesity, smoking). The BLA approval was based on pivotal Phase 3 clinical trial data that showed Nuvaxovid was safe and effective for the prevention of COVID-19. The BLA approval triggered a $175 million milestone payment under the Sanofi CLA.
In August 2025, the U.S. FDA approved the Nuvaxovid™ 2025-2026 Formula for the prevention of COVID-19 in individuals 65 years of age and older, or 12 years through 64 years of age with at least one underlying condition that puts them at high risk for severe outcomes from COVID-19.
Product Pipeline
We are advancing our pipeline of late- and early-stage programs with a focus on potentially high-value assets in areas with unmet medical need, compelling scientific rationale and strong commercial opportunity. Development and advancement of our in-house pipeline leverages our core expertise and our experience in respiratory and infectious diseases and vaccines, and we intend to explore new opportunities with the potential to expand beyond infectious diseases. Our partnered pipeline includes our COVID-19 Vaccine and our Matrix-M adjuvant used in collaboration for development of new and existing vaccines.
Pipeline Overview
Our pipeline encompasses vaccine candidates for infectious diseases. Our COVID-19 Vaccine, partnered with Sanofi, is our most advanced product. In 2025 and continuing during the term of the Sanofi CLA, Sanofi will lead commercialization efforts for our COVID-19 Vaccine. Our COVID-19 Vaccine has received authorizations from the U.S. FDA, the European Commission ("EC"), the World Health Organization ("WHO") and several other countries for both adult and adolescent populations. Beyond our COVID-19 Vaccine, our late-stage pipeline includes a CIC vaccine candidate, and our stand-alone influenza vaccine candidate.
Additionally, we intend to develop our early-stage pipeline using a disciplined and capital-efficient approach. Our R&D investment strategy seeks to place targeted investments on the programs with the highest potential value, both within infectious disease and beyond, with the intent of partnering these programs at proof of concept. We would consider advancing a program ourselves where data and commercial landscape indicate a unique high-value opportunity. We are actively developing a pandemic influenza vaccine candidate and pursuing funding opportunities to join preparedness options. We are conducting early-stage research in diseases such as, RSV combinations, Shingles and C. Diff. Lastly, we are evaluating potential expansion beyond infectious diseases, where we believe our technology has the potential to augment and improve upon current therapies. In the first quarter of 2025, we entered into a preclinical collaboration with a partner to explore the application and utility of Matrix-M adjuvant with their cancer vaccine candidate.
In addition to our own pipeline, we have several partnership opportunities. For example, our Matrix-M adjuvant is being used for collaboration in R21/Matrix-M adjuvant malaria vaccine.
Under our agreement, we have also provided a sole license to Sanofi for the independent development of a COVID-19 and influenza combination product using our COVID-19 Vaccine in combination with two of Sanofi's separately marketed influenza vaccines, Fluzone High-Dose and Flublok, to evaluate immunogenicity and safety in Phase 1/2 combination vaccine trials. These two combination vaccine candidates were granted Fast Track designation by the U.S. FDA in December 2024 to prevent influenza and COVID-19 infections in individuals aged 50 and older. In October 2025, Sanofi reported preliminary positive immunogenicity and safety Phase 1/2 data for Nuvaxovid in combination with both Fluzone High-Dose and Flublok. Sanofi also has a non-exclusive license to develop and commercialize combination products containing both our COVID-19 Vaccine and one or more non-influenza vaccines, and a non-exclusive license to develop and commercialize other vaccine products selected by Sanofi that include our Matrix-M adjuvant.
In September 2025, we amended the Sanofi CLA to expand Sanofi's license to include use of Novavax's Matrix-M adjuvant in Sanofi's pandemic influenza vaccine candidate program. Sanofi recently received funding from the Biomedical Advanced Research and Development Authority within the Administration for Strategic Preparedness and Response, part of the U.S. Department of Health and Human Services, for early-stage work on this vaccine candidate including the Matrix-M adjuvant.
Coronavirus Vaccine Clinical Development
We continue to evaluate vaccine safety, immunogenicity, and effectiveness through ongoing clinical trials and collaborative evidence-generating real-world studies.
Phase 3 Strain-Change and Re-vaccination Studies
In October 2024, we initiated and fully enrolled Study 315 to evaluate safety and immunogenicity of a single dose of the JN.1 subvariant vaccine NVX-CoV2705 in previously vaccinated adults. Topline data from this study was submitted to the U.S. FDA in February 2025 and showed that our JN.1 vaccine induced robust cross-reactive neutralizing activity to the JN.1 variant and to a panel of JN.1 lineage strains representing virtually all of those that circulated in the U.S. during the 2024-2025 respiratory virus season. We conduct testing against newly emerging strains as we prepare for the annual vaccination season, and this testing informs future strain formulations.
In October 2025, we initiated an additional study, Study 318, as a post-marketing commitment for the U.S. FDA. The study is evaluating the safety and immunogenicity of the JN.1 vaccine in the US-approved population of individuals 12 through 64 years of age with at least one underlying condition that puts them at high risk for severe outcomes from COVID-19 and in adults ≥ 65 years of age.
Phase 2b/3 Pediatric Hummingbird™ Trial
In December 2024, we achieved the $50 million milestone under our agreement with Sanofi, associated with the database lock for one of the three cohorts in this trial.
This trial is evaluating the safety, effectiveness (immunogenicity), and efficacy of two doses of our COVID-19 Vaccine, followed by a booster 6 months after the primary vaccination series. The trial completed enrollment in September 2023 and includes three age de-escalation cohorts of 1,200 children each. Safety follow up was completed in October 2025. The U.S. FDA has informed us that, due to changes in pediatric sero-epidemiology that have occurred since trial initiation, an additional immunogenicity study will be needed to support a supplemental BLA to expand the pediatric indication. We continue to engage with Sanofi to assess the feasibility of achieving an expanded indication in the U.S. given recent policy changes impacting the indicated pediatric population for COVID-19 vaccines.
Phase 4 Postmarketing Commitment Clinical Efficacy and Safety Trial
In May 2025, we announced that the U.S. FDA, as a part of its BLA approval, requested a PMC to conduct a Phase 4 prospective, randomized, double-blinded, placebo-controlled efficacy and safety trial in individuals aged 50 through 64 without high-risk conditions for severe COVID-19. The Company will be responsible to conduct the PMC trial, which was initiated in the fourth quarter of 2025. Sanofi will reimburse the Company for 70% of the PMC costs, capped at the currently agreed upon cost estimates. The Company will recognize cost reimbursements from Sanofi related to the PMC in Licensing, royalties, and other revenue over time using an input method, consistent with research and development transition services that support further regulatory approval and development of the COVID-19 Vaccine ("Sanofi Transition Services") and services related to the technology transfer of the existing manufacturing process for the COVID-19 Vaccine Products and Matrix-M™ adjuvant (the "Sanofi Technology Transfer").
COVID-Influenza Combination and Stand-alone Influenza Program
Phase 3 Clinical Trial of CIC and Stand-alone Influenza Vaccine Candidates
In December 2024, we initiated a Phase 3 immunogenicity and safety trial for our CIC and stand-alone influenza vaccine candidates to evaluate the immunogenicity and safety compared to our updated COVID-19 Vaccine and a licensed seasonal influenza vaccine comparator in adults aged 65 and older. Our Phase 3 immunogenicity and safety trial completed enrollment with an initial cohort of approximately 2,000 participants. In June 2025, we reported data from this initial cohort, which showed both vaccine candidates induced robust immune responses across all antigens tested. Both vaccine candidates were well tolerated with reactogenicity profiles that were comparable to authorized comparators. After consultation with the U.S. FDA, we determined that seeking an accelerated approval pathway for our CIC and stand-alone influenza candidates would not be feasible. While the Phase 3 immunogenicity and safety trial is not a pivotal study, the data will inform a future registrational Phase 3 program. We do not intend to make additional investments in these programs and are seeking a partner to advance both vaccine candidates.
R21/Matrix-M Adjuvant Malaria Vaccine
R21/Matrix-M adjuvant malaria vaccine, formulated with our Matrix-M adjuvant, is developed by our partner, the Jenner Institute, University of Oxford, and manufactured by SII. We have an agreement with SII related to its manufacture of R21/Matrix-M adjuvant malaria vaccine under which SII purchases our Matrix-M adjuvant for use in development activities at cost and for commercial purposes at a tiered commercial supply price, and pays a royalty in the single- to low-double digit range based on vaccine sales for a period of 15 years after the first commercial sale of the vaccine in each country.
In July 2024, first commercial doses of R21/Matrix-M adjuvant malaria vaccine have been administered to children in Cote d'Ivoire and South Sudan. As part of the WHO malaria program, at their discretion, the vaccine is expected to be included in countries such as Central African Republic, Chad, Democratic Republic of Congo, Mozambique, Nigeria and Uganda.
In December 2023, the WHO announced it prequalified the R21/Matrix-M adjuvant malaria vaccine to prevent malaria disease in children caused by the P. falciparum parasite in endemic areas. Prequalification status enables United Nations agencies to procure the vaccine for eligible countries and enabled rollout of the vaccine in mid-2024. The WHO recommended that the R21/Matrix-M adjuvant malaria vaccine be administered in a four-dose schedule beginning at five months of age.
Business Highlights
Third Quarter 2025 and Recent Highlights
Strategic Priority #1: Optimize our Sanofi Partnership
•Continued successful execution of Sanofi partnership with $225 million in milestones earned year-to-date, including $50 million earned in the fourth quarter of 2025, upon marketing authorization transfers for E.U. and U.S. markets.
•In October 2025, Sanofi reported preliminary positive immunogenicity and safety Phase 1/2 data for Nuvaxovid in combination with both Fluzone High-Dose and Flublok. Both programs have received Fast Track designation from the U.S. FDA.
•In August 2025, the FDA approved the Nuvaxovid 2025-2026 Formula for the prevention of COVID-19 in individuals 65 years of age and older, or 12 years through 64 years of age with at least one underlying condition that puts them at high risk for severe outcomes from COVID-19. Nuvaxovid was approved with an extended shelf life of six months in a pre-filled syringe formulation.
•Beginning in the third quarter of 2025, Sanofi assumed the lead commercial role for Nuvaxovid in the U.S. and select ex-U.S. markets for the 2025-2026 COVID-19 vaccination season.
•In September 2025, we expanded Sanofi's license to include use of Novavax's Matrix-M adjuvant in Sanofi's pandemic influenza vaccine candidate program. Sanofi received funding from the Biomedical Advanced Research and Development Authority (BARDA) for early-stage clinical work on this vaccine candidate.
Strategic Priority #2: Enhance Existing Partnerships and Leverage our Technology Platform and Pipeline to Forge Additional Partnerships
•In September 2025, our partner Takeda received approval of Nuvaxovid in Japan which triggered a milestone payment to Novavax.
•R21/Matrix-M, a malaria vaccine developed in partnership with SII and Oxford University, continued to make meaningful progress in addressing the urgent and unmet needs of malaria-endemic regions with 25 million doses sold since launch in mid-2024.
•In the first quarter of 2025, we announced material transfer agreements with three pharmaceutical companies to explore the utility of Matrix-M in their portfolios; discussions continue with these companies for the potential use of Matrix-M in the development of new vaccines and/or improve existing vaccines.
Strategic Priority #3: Advance our Technology Platform and Early-Stage Pipeline
•Continued advancement of early-stage preclinical research for Shingles, C. Diff. and RSV combination vaccine candidates.
•Pursuing government funding for pandemic influenza vaccine candidate.
•Continued exploration of our Matrix-M platform technology in oncology.
Other Corporate Highlights
•In August 2025, we completed a convertible debt refinancing; extending the maturity of the majority of the Company's existing 2027 Notes to 2031, with improved terms, and providing additional proceeds through the issuance of new 2031 Notes. This transaction further supports the financial strength of the company and its ability to execute on its long-term growth strategy.
•In October 2025, we announced transactions to enable the planned consolidation of its Maryland based facilities in line with its corporate strategy. These transactions will result in $60 million in payments to Novavax and are expected to result in future cost savings of approximately $230 million over 11 years.
Sales of Common Stock
In August 2023, we entered into an At Market Issuance Sales Agreement (the "August 2023 Sales Agreement"), which allows us to issue and sell up to $500 million in gross proceeds of shares of our common stock, and terminated our then-existing At Market Issuance Sales agreement entered in June 2021. During the three and nine months ended September 30, 2025, no sales were recorded under the August 2023 Sales Agreement. During the nine months ended September 30, 2024, we sold 12.2 million shares of our common stock under the August 2023 Sales Agreement, resulting in net proceeds of approximately $188 million. There were no sales recorded under the August 2023 Sales Agreement during the three months ended September 30, 2024. As of September 30, 2025, the remaining balance available under the August 2023 Sales Agreement was approximately $51 million.
In May 2024, we entered into the securities subscription agreement, pursuant to which we sold and issued to Sanofi, in a private placement, 6.9 million shares of our common stock, par value $0.01 per share at a price of $10.00 per share for aggregate gross proceeds to us of $68.8 million.
Critical Accounting Policies and Use of Estimates
The discussion and analysis of our financial condition and results of operations are based upon our accompanying unaudited financial statements and the unaudited accompanying notes, which have been prepared in accordance with generally accepted accounting principles in the United States.
The preparation of our consolidated financial statements requires us to make estimates, assumptions, and judgments that affect the reported amounts of assets, liabilities, and equity and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Our critical accounting policies and estimates are included under Item 7 of our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as filed with the SEC.
Recent Accounting Pronouncements Not Yet Adopted
See "Note 2―Summary of Significant Accounting Policies" included in our unaudited consolidated financial statements (under the caption "Recent Accounting Pronouncements").
Results of Operations
The following is a discussion of the historical financial condition and results of our operations that should be read in conjunction with our unaudited consolidated financial statements and notes set forth in this Quarterly Report. Our historical results are not necessarily indicative of the results for any periods in the future.
Three Months Ended September 30, 2025 and 2024
Revenue
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Three Months Ended September 30,
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| 2025 | 2024 | Change | |||||||||||||||
| Revenue (in thousands): | |||||||||||||||||
| Product sales | $ | 13,442 | $ | 41,528 | $ | (28,086) | |||||||||||
| Licensing, royalties, and other | 57,003 | 42,984 | 14,019 | ||||||||||||||
| Total revenue | $ | 70,445 | $ | 84,512 | $ | (14,067) | |||||||||||
Revenue for the three months ended September 30, 2025 was $70.4 million as compared to $84.5 million for the same period in 2024, a decrease of $14.1 million. Revenue for the three months ended September 30, 2025 was primarily comprised of licensing revenue from Transition Services and Technology Transfer and product supply sales of COVID-19 Vaccine under the Sanofi CLA and milestone and royalty revenue with Takeda. Revenue for the three months ended September 30, 2024 was primarily comprised of revenue from Product sales of COVID-19 Vaccine and revenue from Transition Services and Technology Transfer under the Sanofi CLA. The decrease in revenue is primarily due to a decrease in Product sales of COVID-19 Vaccine partially offset by product supply sales of COVID-19 Vaccine and an increase in revenue from Transition Services and Technology Transfer in licensing revenue under the Sanofi CLA.
Product sales
Product sales for the three months ended September 30, 2025 were $13.4 million as compared to $41.5 million for the same period in 2024, a decrease of $28.1 million. Our Product sales related to revenue from Nuvaxovid sales, which commenced in 2022, commercial supply sales of COVID-19 Vaccine, and revenue from supply of adjuvant and other products. We have transitioned the commercial lead for sales and distribution to Sanofi resulting in a decrease in Nuvaxovid sales and an increase in supply sales.
The categories of Product sales were as follows:
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Three Months Ended September 30,
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| 2025 | 2024 | Change | |||||||||||||||
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Product sales (in thousands)
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Nuvaxovid sales(1)
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$ | (332) | $ | 38,210 | $ | (38,542) | |||||||||||
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Supply sales(2)
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13,774 | 3,318 | 10,456 | ||||||||||||||
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Total Product sales
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$ | 13,442 | $ | 41,528 | $ | (28,086) | |||||||||||
(1)Nuvaxovid sales are sales of our COVID-19 Vaccine associated with APAs with various governments globally and commercial markets, where we are the commercial lead for sales and distribution, made through pharmaceutical wholesale distributors. During the three months ended September 30, 2025, Nuvaxovid sales include excess gross-to-net deductions primarily due to updates to estimated product returns.
(2)Supply sales include commercial sales of COVID-19 Vaccine, adjuvant sales, and sale of other materials to our partners. We reclassified $3.3 million of revenue previously reported as License, royalties, and other revenue to Product sales revenue for the three months ended September 30, 2024 related to adjuvant supply sales and other supply sales.
Licensing, royalties, and other
Licensing, royalties, and other revenue during the three months ended September 30, 2025 was $57.0 million as compared to $43.0 million during the same period in 2024, an increase of $14.0 million. The increase was primarily due to an increase in revenue from transition services and technology transfer in licensing revenue under the Sanofi CLA resulting from continued progress on the Transition Services and Technology Transfer, as well as the impact of changes in total costs and consideration estimates.
Licensing, royalties, and other revenue were comprised of the following:
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Licensing, royalties, and other (in thousands) | |||||||||||||||||
| Sanofi | $ | 48,294 | $ | 36,115 | $ | 12,179 | |||||||||||
| Takeda | 6,445 | 4,918 | 1,527 | ||||||||||||||
|
Other partners(1)
|
2,264 | 1,951 | 313 | ||||||||||||||
| Total licensing, royalties, and other revenue | $ | 57,003 | $ | 42,984 | $ | 14,019 | |||||||||||
(1)Other partners revenue includes royalties and license fees associated with agreements with other partners such as Serum.
Sanofi licensing, royalties, and other revenue were comprised of the following:
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
|
Sanofi licensing, royalties, and other revenue (in thousands)
|
|||||||||||||||||
| Licensing: | |||||||||||||||||
|
Upfront fee
|
$ | - | $ | 3,392 | $ | (3,392) | |||||||||||
|
Royalties
|
4,196 | - | 4,196 | ||||||||||||||
|
Transition services and technology transfer:
|
|||||||||||||||||
|
Upfront fee amortization(1)
|
(1,083) | 14,973 | (16,056) | ||||||||||||||
|
Milestones amortization(1)
|
(645) | 7,032 | (7,677) | ||||||||||||||
|
Cost reimbursements
|
45,826 | 10,718 | 35,108 | ||||||||||||||
|
Total Sanofi licensing, royalties, and other revenue
|
$ | 48,294 | $ | 36,115 | $ | 12,179 | |||||||||||
(1)Upfront fee amortization and Milestones amortization represent revenue recognized during the period related to a portion of the $500 million upfront payment and the $50 million milestone for database lock of an existing Phase 2/3 clinical trial in 2024 that were deferred upon achievement and are recognized in revenue over time. During the three months ended September 30, 2025, recognized a change in estimate to cumulative revenue recognized for the Sanofi Transition Services performance obligation of $12.5 million as further described in Note 6, which also resulted in a reduction in upfront fee and milestone amortization revenue during the third quarter of 2025, and an increase in cost reimbursement revenue.
Takeda licensing, royalties, and other revenue were comprised of the following (in thousands):
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Takeda licensing, royalties, and other revenue | |||||||||||||||||
| Licensing: | |||||||||||||||||
| Milestones | $ | 4,717 | $ | - | $ | 4,717 | |||||||||||
|
Royalties
|
1,456 | 4,564 | (3,108) | ||||||||||||||
| Support services | 272 | 354 | (82) | ||||||||||||||
| Tota Total Takeda licensing, royalties, and other revenue | $ | 6,445 | $ | 4,918 | $ | 1,527 | |||||||||||
Expenses
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Expenses (in thousands): | |||||||||||||||||
| Cost of sales | $ | 21,496 | $ | 60,619 | $ | (39,123) | |||||||||||
| Research and development | 98,274 | 87,164 | 11,110 | ||||||||||||||
| Selling, general, and administrative | 31,655 | 70,747 | (39,092) | ||||||||||||||
|
Impairment of assets held for sale
|
97,038 | - | 97,038 | ||||||||||||||
| Total expenses | $ | 248,463 | $ | 218,530 | $ | 29,933 | |||||||||||
Cost of Sales
Cost of sales was $21.5 million for the three months ended September 30, 2025, including expenses of $0.5 million related to excess, obsolete, or expired inventory, $1.8 million ROU asset impairment charges for CMO manufacturing capacity of excess quantities, and $3.5 million related to unutilized manufacturing capacity. Cost of sales was $60.6 million for the three months ended September 30, 2024, including expense of $6.2 million related to excess, obsolete, or expired inventory and losses on firm purchase commitments, $3.8 million ROU asset impairment charges for CMO manufacturing capacity of excess quantities, $18.2 million related to unutilized manufacturing capacity, and a credit of $0.7 million related to certain negotiated reductions to previously recognized firm purchase commitments. The decrease in cost of sales of $39.1 million was mainly driven by a decrease in the number of COVID-19 Vaccine doses sold, the sale of the Novavax CZ manufacturing facility in December 2024, a decrease in excess, obsolete, and expired inventory charges, and a decrease in unutilized manufacturing capacity charges. The cost of sales as a percentage of Product sales may fluctuate in the future as a result of changes to our customer pricing mix or standard costs.
Research and Development Expenses
Research and development expenses were $98.3 million for the three months ended September 30, 2025 as compared to $87.2 million for the three months ended September 30, 2024, a increase of $11.1 million. The increase was primarily due to an increase in in overall expenditures relating to development activities on coronavirus vaccines, including our COVID-19
Program, in support of Sanofi Transition Services, offset by certain cost containment measures to reduce our operating spend, as summarized in the table below (in thousands):
|
Three Months Ended September 30,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Coronavirus vaccines | $ | 39,439 | $ | 21,798 | |||||||
|
Other vaccine development programs
|
1,296 | 2,660 | |||||||||
| Total direct external research and development expense | 40,735 | 24,458 | |||||||||
| Employee expenses | 31,779 | 33,504 | |||||||||
| Stock-based compensation expense | 3,491 | 5,166 | |||||||||
| Facility expenses | 14,568 | 13,855 | |||||||||
| Other expenses | 7,701 | 10,181 | |||||||||
| Total research and development expenses | $ | 98,274 | $ | 87,164 | |||||||
Research and development expenses for coronavirus vaccines for the three months ended September 30, 2025 and 2024 increase from $21.8 million to $39.4 million primarily as a result of increased costs in support of Sanofi Transition Services, offset by our global restructuring and cost reduction efforts and a reduction in manufacturing and support costs due, in part, to a reduction in our global manufacturing footprint consistent with our contractual obligations to supply, and anticipated demand for, COVID-19 Vaccine, under manufacturing supply agreements with CMOs and contract manufacturing and development organizations ("CDMOs").
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses were $31.7 million for the three months ended September 30, 2025 as compared to $70.7 million for the same period in 2024, a decrease of $39.1 million. The decrease in selling, general, and administrative expenses is primarily due to certain cost containment measures to reduce our operating spend, including a reduction in our global commercial footprint and administrative infrastructure and the sale of the Novavax CZ manufacturing facility in December 2024.
Impairment of assets held for sale
During the three months ended September 30, 2025, we classified our corporate headquarters facility at 700 Quince Orchard, Gaithersburg, Maryland ("700QO"), together with certain related property and equipment and land parcel adjacent to the facility (collectively referred to as the "Disposal Group"), as held for sale. The carrying value of the Disposal Group was determined to be greater than its fair value less costs to sell and, consequently, an impairment loss of $97 million was recognized during the three months ended September 30, 2025, and recorded in Impairment of assets held for sale in the Consolidated Statements of Operations. In October 2025, the Company entered into a definitive agreement to sell the Disposal Group (see Note 18 to our unaudited consolidated financial statements).
For the remainder of 2025, we expect a reduction in our annual combined research and development, and selling, general, and administrative spend as a result of our Restructuring Plan as discussed in Note 16 to our accompanying unaudited consolidated financial statements.
Other Income (Expense)
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
|
Other income (expense), net (in thousands):
|
|||||||||||||||||
| Interest expense | $ | (5,482) | $ | (4,236) | $ | (1,246) | |||||||||||
|
Loss on debt extinguishment
|
(28,714) | - | (28,714) | ||||||||||||||
| Other income (expense), net | 9,178 | 15,922 | (6,744) | ||||||||||||||
|
Total other income (expense), net
|
$ | (25,018) | $ | 11,686 | $ | (36,704) | |||||||||||
Total other income (expense), net was $25.0 million of expense for the three months ended September 30, 2025 as compared to a total other income (expense), net of $11.7 million of income for the same period in 2024. The decrease in other
income (expense), net is primarily due to a $28.7 million loss on debt extinguishment recorded in the three months ended September 30, 2025 and a reduction in interest income on investments in marketable securities during the period.
Income Tax Expense
During the three months ended September 30, 2025, we recognized an income tax benefit of $0.7 million related to federal, state, and foreign income taxes, and foreign withholding tax expense. During the three months ended September 30, 2024, we recognized an income tax benefit of $1.0 million related to federal, state, and foreign income taxes, and foreign withholding taxes.
Net Loss
|
Three Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
|
Net loss (in thousands, except per share information):
|
|||||||||||||||||
|
Net loss
|
$ | (202,379) | $ | (121,300) | $ | (81,079) | |||||||||||
|
Net loss per share, basic and diluted
|
$ | (1.25) | $ | (0.76) | $ | (0.49) | |||||||||||
|
Weighted average shares outstanding, basic and dilutive
|
162,353 | 160,049 | 2,304 | ||||||||||||||
Net loss for the three months ended September 30, 2025 was $202.4 million, or $1.25 per share, basic and dilutive, as compared to net loss of $121.3 million, or $0.76 per share, basic and dilutive, for the same period in 2024. The increase in net loss during the three months ended September 30, 2025, was primarily due to the impairment of assets held for sale and loss on debt extinguishment, partially offset by a decrease in total operating expenses.
The increase in weighted average shares outstanding for the three months ended September 30, 2025, was primarily a result of sales of our common stock in 2024 and common stock issued under our incentive programs.
Nine Months Ended September 30, 2025 and 2024
Revenue
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Revenue (in thousands): | |||||||||||||||||
| Product sales | $ | 645,844 | $ | 153,952 | $ | 491,892 | |||||||||||
| Licensing, royalties, and other | 330,496 | 439,899 | (109,403) | ||||||||||||||
| Total revenue | $ | 976,340 | $ | 593,851 | $ | 382,489 | |||||||||||
Revenue for the nine months ended September 30, 2025 was $976.3 million as compared to $593.9 million for the same period in 2024, an increase of $382.5 million. Revenue for the nine months ended September 30, 2025 was primarily comprised of revenue from the termination of our APAs with Canada ("Canada APA") and New Zealand ("New Zealand APA") of $575.7 million and $27.3 million, respectively, licensing revenue from the achievement of milestones under the Sanofi CLA and revenue from Transition Services and Technology Transfer under the Sanofi CLA, and licensing and royalty revenue with Takeda. Revenue for the nine months ended September 30, 2024 was primarily comprised of revenue from licensing revenue from execution of the Sanofi CLA, revenue from Transition Services and Technology Transfer under the Sanofi CLA, and Product sales of COVID-19 Vaccine. The increase in revenue is primarily due to an increase in Product sales from the termination of our Canada and New Zealand APAs, partially offset by a decrease in Licensing, royalties, and other revenue from the Sanofi CLA.
Product sales
Product sales for the nine months ended September 30, 2025 were $645.8 million as compared to $154.0 million during the nine months ended September 30, 2024, an increase of $491.9 million. Our Product sales related to revenue from
Nuvaxovid sales, which commenced in 2022, commercial supply sales of COVID-19 Vaccine, revenue from supply of adjuvant and other products, and the termination of our Canada and New Zealand APAs.
The categories of Product sales were as follows:
|
Nine Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
|
Product sales (in thousands)
|
|||||||||||||||||
|
Nuvaxovid sales(1)
|
$ | 605,599 | $ | 140,438 | $ | 465,161 | |||||||||||
|
Supply sales(2)
|
40,245 | 13,514 | 26,731 | ||||||||||||||
|
Total Product sales
|
$ | 645,844 | $ | 153,952 | $ | 491,892 | |||||||||||
(1) Nuvaxovid sales are sales of our COVID-19 Vaccine associated with APAs with various governments globally and commercial markets, where we are the commercial lead for sales and distribution, made through pharmaceutical wholesale distributors.
(2) Supply sales include commercial sales of COVID-19 Vaccine, adjuvant sales, and sale of other materials to our partners. We reclassified $13.5 million of revenue previously reported as License, royalties, and other revenue to Product sales revenue for the nine months ended September 30, 2024 related to adjuvant supply sales and other supply sales.
Licensing, royalties, and other
Licensing, royalties, and other revenue during the nine months ended September 30, 2025 was $330.5 million as compared to $439.9 million during the same period in 2024, a decrease of $109.4 million. The decrease was primarily due to a decrease in revenue under the Sanofi CLA, offset by an increase in revenue from other partners, including under the Amended Takeda CLA.
Licensing, royalties, and other revenue were comprised of the following:
|
Nine Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Licensing, royalties, and other (in thousands) | |||||||||||||||||
| Sanofi | $ | 288,027 | $ | 429,012 | $ | (140,985) | |||||||||||
| Takeda | 33,657 | 4,918 | 28,739 | ||||||||||||||
|
Other partners(1)
|
8,812 | 5,969 | 2,843 | ||||||||||||||
| Total licensing, royalties, and other revenue | $ | 330,496 | $ | 439,899 | $ | (109,403) | |||||||||||
(1)Other partners revenue includes royalties and license fees associated with agreements with other partners such as Serum and SK bioscience, Co., Ltd.
Sanofi licensing, royalties, and other revenue were comprised of the following:
|
Nine Months Ended September 30,
|
|||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
|
Sanofi licensing, royalties, and other revenue (in thousands)
|
|||||||||||||||||
| Licensing: | |||||||||||||||||
|
Upfront fee
|
$ | - | $ | 389,642 | $ | (389,642) | |||||||||||
| Milestones | 175,000 | - | 175,000 | ||||||||||||||
|
Royalties
|
4,196 | - | 4,196 | ||||||||||||||
|
Transition services and technology transfer:
|
|||||||||||||||||
|
Upfront fee amortization(1)
|
31,097 | 19,546 | 11,551 | ||||||||||||||
|
Milestones amortization(1)
|
14,163 | 9,105 | 5,058 | ||||||||||||||
|
Cost reimbursements
|
63,571 | 10,719 | 52,852 | ||||||||||||||
|
Total Sanofi licensing, royalties, and other revenue
|
$ | 288,027 | $ | 429,012 | $ | (140,985) | |||||||||||
(1)Upfront fee amortization and Milestones amortization represent revenue recognized during the period related to a portion of the $500 million upfront payment and the $50 million milestone for database lock of an existing Phase 2/3 clinical trial in 2024 that were deferred upon achievement and are recognized in revenue over time.
Takeda licensing, royalties, and other revenue were comprised of the following (in thousands):
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Takeda licensing, royalties, and other revenue | |||||||||||||||||
| Licensing: | |||||||||||||||||
|
Upfront fee(1)
|
$ | 18,500 | $ | - | $ | 18,500 | |||||||||||
| Milestones | 8,151 | - | 8,151 | ||||||||||||||
|
Royalties
|
6,456 | 4,564 | 1,892 | ||||||||||||||
| Support services | 550 | 354 | 196 | ||||||||||||||
|
Tota Total Takeda licensing, royalties, and other revenue
|
$ | 33,657 | $ | 4,918 | $ | 28,739 | |||||||||||
(1)Upfront fee includes $14.5 million of nonrefundable upfront payments associated with the Amended Takeda CLA and $4.0 million of previously unrecognized consideration from the Original Takeda CLA.
Expenses
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Expenses (in thousands): | |||||||||||||||||
| Cost of sales | $ | 50,936 | $ | 166,070 | $ | (115,134) | |||||||||||
| Research and development | 266,444 | 286,789 | (20,345) | ||||||||||||||
| Selling, general, and administrative | 123,357 | 258,843 | (135,486) | ||||||||||||||
|
Impairment of assets held for sale
|
97,038 | - | 97,038 | ||||||||||||||
| Total expenses | $ | 537,775 | $ | 711,702 | $ | (173,927) | |||||||||||
Cost of Sales
Cost of sales was $50.9 million for the nine months ended September 30, 2025, including expenses of $1.9 million related to excess, obsolete, or expired inventory, $1.8 million ROU asset impairment charges for CMO manufacturing capacity of excess quantities, and $7.0 million related to unutilized manufacturing capacity. Cost of sales was $166.1 million for the nine months ended September 30, 2024, including expense of $26.4 million related to excess, obsolete, or expired inventory and losses on firm purchase commitments, $3.8 million ROU asset impairment charges for CMO manufacturing capacity of excess quantities, $37.1 million related to unutilized manufacturing capacity, and a credit of $0.7 million related to certain negotiated reductions to previously recognized firm purchase commitments. The decrease in cost of sales of $115.1 million was mainly driven by a decrease in the number of COVID-19 Vaccine doses sold, the sale of the Novavax CZ manufacturing facility in December 2024, a decrease in excess, obsolete, and expired inventory charges, and a decrease in unutilized manufacturing capacity charges. The cost of sales as a percentage of Product sales may fluctuate in the future as a result of changes to our customer pricing mix or standard costs.
Research and Development Expenses
Research and development expenses decreased to $266.4 million for the nine months ended September 30, 2025 from $286.8 million for the same period in 2024, a decrease of $20.3 million. The decrease was primarily due to a reduction in overall expenditures relating to development activities on coronavirus vaccines, including our COVID-19 Program, and CIC, and due to certain cost containment measures to reduce our operating spend, as summarized in the table below (in thousands):
|
Nine Months Ended September 30,
|
|||||||||||
| 2025 | 2024 | ||||||||||
| Coronavirus vaccines | $ | 86,161 | $ | 87,759 | |||||||
| Other vaccine development programs | 4,017 | 3,395 | |||||||||
| Total direct external research and development expense | 90,178 | 91,154 | |||||||||
| Employee expenses | 100,049 | 107,696 | |||||||||
| Stock-based compensation expense | 11,281 | 16,848 | |||||||||
| Facility expenses | 40,380 | 38,551 | |||||||||
| Other expenses | 24,556 | 32,540 | |||||||||
| Total research and development expenses | $ | 266,444 | $ | 286,789 | |||||||
Selling, General, and Administrative Expenses
Selling, general, and administrative expenses decreased to $123.4 million for the nine months ended September 30, 2025 from $258.8 million for the same period in 2024, a decrease of $135.5 million. The decrease in selling, general, and administrative expenses is primarily due to certain cost containment measures to reduce our operating spend, including a reduction in our global commercial footprint and administrative infrastructure and the sale of the Novavax CZ manufacturing facility in December 2024.
Impairment of assets held for sale
During the nine months ended September 30, 2025, we classified the Disposal Group as held for sale. The carrying value of the Disposal Group was determined to be greater than its fair value less costs to sell and, consequently, an impairment loss of $97 million was recognized during the nine months ended September 30, 2025, and recorded in Impairment of assets held for sale in the Consolidated Statements of Operations. In October 2025, the Company entered into a definitive agreement to sell the Disposal Group (see Note 18 to our unaudited consolidated financial statements).
Other Income (Expense)
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Other income (expense), net (in thousands): | |||||||||||||||||
| Interest expense | $ | (16,723) | $ | (12,490) | $ | (4,233) | |||||||||||
| Loss on debt extinguishment | (28,714) | - | (28,714) | ||||||||||||||
| Other income | 31,136 | 27,307 | 3,829 | ||||||||||||||
| Total other income (expense), net | $ | (14,301) | $ | 14,817 | $ | (29,118) | |||||||||||
Total other income (expense), net for the nine months ended September 30, 2025 was $14.3 million of expense as compared to $14.8 million of income for the same period in 2024, a decrease of $29.1 million. The decrease in other income (expense) is primarily due to a $28.7 million loss on debt extinguishment.
Income Tax Expense
During the nine months ended September 30, 2025, we recognized an income tax expense of $1.5 million related to federal, state, and foreign income taxes and foreign withholding taxes. During the nine months ended September 30, 2024, we recognized an income tax expense of $3.4 million related to federal, state, and foreign income taxes.
Net Income (Loss)
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Net Income (Loss) (in thousands, except per share information): | |||||||||||||||||
| Net income (loss) | $ | 422,775 | $ | (106,469) | $ | 529,244 | |||||||||||
| Net income (loss) per share, basic | $ | 2.61 | $ | (0.71) | $ | 3.32 | |||||||||||
| Net income (loss) per share, dilutive | $ | 2.53 | $ | (0.71) | $ | 3.24 | |||||||||||
| Weighted average shares outstanding, basic | 161,811 | 149,486 | 12,325 | ||||||||||||||
| Weighted average shares outstanding, dilutive | 168,195 | 149,486 | 18,709 | ||||||||||||||
Net income (loss) for the nine months ended September 30, 2025 was net income of $422.8 million, or $2.61 per share, basic and $2.53 per share, dilutive, as compared to net loss of $106.5 million, or $(0.71) per share, basic and dilutive, for the same period in 2024. The increase in net income during the nine months ended September 30, 2025, was primarily due to an increase in total revenue and a decrease in total expenses.
The increase in weighted average shares outstanding for the nine months ended September 30, 2025 is primarily a result of sales of our common stock in 2024 and common stock issued under our incentive programs.
Liquidity Matters and Capital Resources
Our future capital requirements depend on numerous factors including, but not limited to, revenue from our Product sales, milestone payments, royalties, and reimbursements under licensing arrangements with our strategic partners; our projected activities related to the development and commercial support of our COVID-19 Vaccine and our CIC and stand-alone influenza vaccine candidates, including significant commitments under various clinical research organizations, CMO, and CDMO agreements; the progress of preclinical studies and clinical trials; the time and costs involved in obtaining and maintaining regulatory approvals; the costs of filing, prosecuting, defending, and enforcing patent claims and other intellectual property rights; and other manufacturing, sales, and distribution costs. We plan to continue developing other vaccines and product candidates, such as our potential combination vaccine candidates, which are in various stages of development. Our ability to generate revenue from Product sales is subject to uncertainty specifically as it relates to our ability to successfully develop, manufacture, distribute, and market our updated vaccine and to successfully execute on our licensing arrangements with our strategic partners and our APAs, as discussed below. Additionally, our plans include our ongoing restructuring and cost reduction measures as a part of our Restructuring Plan (see Note 16 to our accompanying unaudited consolidated financial statements), and may also include raising additional capital through a combination of additional equity and debt financing, collaborations, strategic alliances, asset sales, and marketing, distribution, or licensing arrangements. New financings may not
be available to us on commercially acceptable terms, or at all. If we are unable to obtain additional capital, we will assess our capital resources and may be required to delay, reduce the scope of, or eliminate some or all of our operations, or further downsize our organization, any of which may have a material adverse effect on our business, financial condition, results of operations.
Sanofi Collaboration and License Agreement
In May 2024, we entered into the Sanofi CLA pursuant to which we received a non-refundable upfront payment of $500 million. During the nine months ended September 30, 2025, we received milestone payments of $50 million for the database lock of an existing Phase 2/3 clinical trial in 2024 and $175 million earned upon the approval of the marketing authorization for a COVID-19 Vaccine Product in a pre-filled syringe from the U.S. FDA. As of September 30, 2025, we are eligible to receive additional development, technology transfer, launch, and sales milestone payments totaling up to $475 million in the aggregate with respect to the Licensed COVID-19 Products and royalty payments on Sanofi's sales of such licensed products. In addition, we are eligible to receive development, launch, and sales milestone payments of up to $200 million for each of the first four adjuvant Products and $210 million for each adjuvant Product thereafter, and royalty payments on Sanofi's sales of all such licensed products.
As of September 30, 2025, remaining Sanofi sales milestone payments of $475 million include $125 million related to COVID-19 Vaccine Products and $350 million related to influenza-COVID-19 combination products. The COVID-19 Vaccine Products milestones remaining include $25 million receivable upon the transfer of the U.S. marketing authorization holder ("MAH") to Sanofi, $25 million receivable upon the transfer of the European Medicines Agency ("EMA") MAH in a pre-filled syringe to Sanofi, and $75 million receivable upon the completion of the technology transfer of our manufacturing process for the COVID-19 Vaccine Products to Sanofi. The influenza-COVID-19 combination product milestones include a $125 million milestone receivable upon achievement of certain influenza-COVID-19 combination products-related development milestones, and a $225 million in influenza-COVID-19 combination products-related launch milestones. In October 2025, we completed the transfer of the EMA MAH in a pre-filled syringe to Sanofi which triggered a $25 million milestone. In November 2025, we completed the transfer of the U.S. FDA MAH in a pre-filled syringe to Sanofi which triggered a $25 million milestone. We expect to receive these milestones in the first quarter of 2026
Beginning in 2025 and continuing during the term of the Sanofi CLA, we and Sanofi began to commercialize the COVID-19 Vaccine Products worldwide in accordance with a commercialization plan agreed by us and Sanofi, under which we will continue to supply our existing APA customers and strategic partners, including Takeda and SII. Upon completion of the existing APAs, we and Sanofi will jointly agree on commercialization activities of each party in each jurisdiction.
Takeda Amended and Restated Collaboration and License Agreement
On April 29, 2025, we entered into the Amended Takeda CLA which amends and supersedes the Original Takeda CLA.
We determined the initial transaction price at inception of the Amended Takeda CLA to be $27.5 million, consisting of (i) $19.5 million of a non-refundable upfront payment, (ii) $4.0 million of non-cancelable annual support payments within the 18 month notice period for contract termination, and (iii) $4.0 million of previously unrecognized consideration from the Original Takeda CLA. We allocated $26.9 million of fixed consideration to the Updated Takeda License performance obligations and $0.6 million to Takeda Support Services.
We recognized revenue of $26.9 million related to the Updated Takeda License on the transfer of the rights and control of the license to Takeda during the nine months ended September 30, 2025. The Takeda Support Services are recognized in revenue over time using an input method to measure progress by utilizing costs incurred to-date relative to total expected costs. Revenue recognized related to Takeda support Services for the three and nine months ended September 30, 2025 was $0.3 million and $0.6 million, respectively.
Under the Amended Takeda CLA, we received a non-refundable upfront payment of $19.5 million of which $5.0 million is creditable against royalties owed by Takeda for its fiscal year 2024. In addition, on an annual basis, we will receive $2.0 million to compensate us for services provided by us under the Takeda CLA, and we will receive an additional $8.0 million annual milestone payment, of which $5.0 million is creditable against royalties owed by Takeda in its fiscal year 2025 or thereafter, if Takeda receives marketing approval of the COVID-19 Vaccine in that year or such approval is not necessary for such year. The parties have also updated the financial terms to replace the share of operating profits and, instead, provide us with a tiered royalty as a percentage of Takeda's, its affiliates' and sublicensees' total net sales in the mid to high-teen percentages (subject to certain capped royalty reductions), which commenced on April 1, 2024 and will continue until the later of (a) twenty years after April 29, 2025, (b) all our know-how licensed under the Amended Takeda CLA has become publicly available through no fault of Takeda, and (c) the expiration of the last valid claim in the intellectual property rights licensed by us to Takeda under the Amended Takeda CLA covering COVID-19 Vaccine in Japan. During the three months ended September 30, 2025, we recognized $4.7 million of milestone revenue for additional milestones earned under the Amended Takeda CLA.
In connection with the Amended Takeda CLA, on April 29, 2025, we entered into a release agreement with Takeda under which we released Takeda and Takeda released us from all claims that were asserted or could have been asserted by either party against the other party that related to the Original Takeda CLA and the activities thereunder.
Supply Agreements
As of September 30, 2025, we have $222.1 million of remaining obligations under APAs with certain countries globally, excluding the Vaccine Alliance ("Gavi"). These obligation include $133.9 million related to an APA with the Commonwealth of Australia for the purchase of doses of COVID-19 Vaccine (the "Australia APA") and $88.2 million related to various other countries. With respect to the Australia APA, as of September 30, 2025, $31.3 million was classified as current Deferred revenue and $102.6 million was classified as non-current Deferred revenue in our consolidated balance sheet. Following the withdrawal of our application at the request of the Therapeutic Goods Administration ("TGA") for authorization of our updated COVID-19 Vaccine, we are in discussions with the TGA regarding potential regulatory paths for approval, including the submission of a new application. We may seek to further amend the Australian APA in light of this development, which amendment may not be achievable on acceptable terms or at all. In the event that we do not, on or before the relevant contractual deadlines, receive regulatory approval for, and deliver, the seasonally updated COVID-19 Vaccine, up to $92.5 million of deferred revenue may become refundable if the Australian APA were to be terminated, of which $10.8 million may become refundable if 2025 dose deliveries are cancelled. Specifically, Australia may cancel doses that are due to be delivered in 2025 if we do not receive regulatory approval for, and deliver, the updated COVID-19 Vaccine on or before December 31, 2025, and may terminate the Australia APA, as amended, if we do not receive regulatory approval for, and deliver, the updated COVID-19 Vaccine on or before March 31, 2026. With respect to other obligations under APAs of $88.2 million, as of September 30, 2025, $38.4 million was classified as current Deferred revenue, $49.8 million was classified as non-current Deferred revenue in our consolidated balance sheet. Recognition of these amounts is dependent on delivery of doses or expiry of optional dose order quantities.
In November 2024, we entered into a settlement agreement with the Secretary of State for Business, Energy and Industrial Strategy (as assigned to the UK Health Security Agency), acting on behalf of the government of the United Kingdom of Great Britain and Northern Ireland (the "Authority"), pursuant to which we and the Authority agreed to terminate the Amended and Restated Supply Agreement with the Authority and to fully settle the outstanding amount under dispute related to upfront payments of $112.5 million. We agreed to pay a refund of $123.8 million, including interest of $11.3 million to the Authority, in equal quarterly installments of $10.3 million over a three year period, ending in June 2027. As of September 30, 2025, pursuant to our settlement agreement with the UK, the remaining upfront payment previously received from the authority is classified as $38.0 million of other current liabilities and $30.0 million of Other non-current liabilities on our consolidated balance sheet.
In February 2024, we and Gavi entered into a Termination and Settlement Agreement (the "Gavi Settlement Agreement") terminating our APA with Gavi (the "Gavi APA"). In total, the Gavi settlement agreement is comprised of $700 million of potential consideration, consisting of $75 million initial settlement payment, deferred payments of up to $400 million that may be reduced through annual vaccine credits, and an additional credit of up to $225 million that may be applied against certain qualifying sales. As of September 30, 2025, the remaining amounts included on our consolidated balance sheet are classified as $225.0 million in non-current Deferred revenue for the additional credit that may be applied against future qualifying sales, $80.0 million in Other current liabilities, and $210.0 million in Other non-current liabilities. In addition, we and Gavi entered into a security agreement pursuant to which we granted Gavi a security interest in accounts receivable from SII under the SII R21 Agreement (see Note 6 to our accompanying unaudited consolidated financial statements), which will
continue for the deferred payment term of the Gavi Settlement Agreement. On February 22, 2024, the claims and counterclaims were dismissed with prejudice.
2031 Convertible Notes
In August 2025, we issued $225.0 million aggregate principal amount of our 4.625% Convertible Senior Notes due 2031 (the "2031 Notes") consisting of (a) $175.3 million principal amount of 2031 Notes issued in exchange for $148.8 million principal amount of our 5.00% Convertible Senior Notes due 2027, and (b) approximately $49.7 million principal amount of 2031 Notes issued for cash, in each case, pursuant to exemptions from registration under the Securities Act and the rules and regulations thereunder. The 2031 Notes were issued pursuant to, and are governed by, an indenture, dated as of August 27, 2025, between the Company and The Bank of New York Mellon Trust Company, N.A. as trustee. For additional information on the 2031 Notes, see Note 11 to our accompanying unaudited consolidated financial statements.
Cash Flows
As of September 30, 2025, we had $778.2 million in cash and cash equivalents, restricted cash and marketable securities as compared to $938.2 million as of December 31, 2024. We received $175 million related to the milestone payment triggered under the Sanofi CLA in 2025.
We funded our operations for the nine months ended September 30, 2025 primarily with cash and cash equivalents, proceeds from the 2031 Notes, milestone payments under the Sanofi CLA and revenue from Product sales. In accordance with our ongoing Restructuring Plan, we continue to restructure our global footprint including further reductions in our global workforce and facilitating the disposal of real estate assets in Gaithersburg, Maryland. We anticipate our future operations to be funded primarily by milestone payments, royalties, transition services and technology transfer and cost reimbursements under our Sanofi CLA, revenue from Product sales, our cash and cash equivalents and investments in marketable securities, and other potential funding sources including equity financings, which may include at the market offerings, debt financings, collaborations, strategic alliances, asset sales, and marketing, distribution or licensing arrangements.
The following table summarizes cash flows for the nine months ended September 30, 2025 and 2024 (in thousands):
| Nine Months Ended September 30, | |||||||||||||||||
| 2025 | 2024 | Change | |||||||||||||||
| Net cash provided by (used in): | |||||||||||||||||
| Operating activities | $ | (205,160) | $ | 85,900 | $ | (291,060) | |||||||||||
| Investing activities | (98,750) | (348,045) | 249,295 | ||||||||||||||
| Financing activities | 34,341 | 264,005 | (229,664) | ||||||||||||||
| Effect on exchange rate on cash, cash equivalents, and restricted cash | 7,634 | 2,917 | 4,717 | ||||||||||||||
|
Net increase (decrease) in cash, cash equivalents, and restricted cash
|
(261,935) | 4,777 | (266,712) | ||||||||||||||
| Cash, cash equivalents, and restricted cash at beginning of period | 545,292 | 583,810 | (38,518) | ||||||||||||||
| Cash, cash equivalents, and restricted cash at end of period | $ | 283,357 | $ | 588,587 | $ | (305,230) | |||||||||||
Net cash used in operating activities was $205.2 million for the nine months ended September 30, 2025, as compared to $85.9 million of cash provided for the same period in 2024. The increase in cash used in operating activities is primarily due to a reduction in cash received from receivables on APA agreements in 2025 as compared to the same period in 2024.
Net cash used in investing activities was $98.8 million for the nine months ended September 30, 2025, as compared to $348.0 million of cash used for the same period in 2024. The decrease in cash used in investing activities is primarily due to our lower investment in marketable securities in 2025 as compared to 2024.
Net cash provided by financing activities was $34.3 million for the nine months ended September 30, 2025, as compared to net cash provided by financing activities of $264.0 million for the same period in 2024. The decrease in cash provided by financing activities is primarily due to a decrease in net proceeds from sales of common stock, partially offset by proceeds from the issuance of our 2031 Notes.
Going Concern
As described in Note 2 to our accompanying unaudited consolidated financial statements, we evaluated our ability to continue as a going concern and concluded that we will have sufficient capital available to fund our operations for at least one-year from the date that the financial statements were issued.
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