U.S. vaccine maker Novavax lost 31% of its market value on Tuesday as falling demand for its COVID 19 shot from low and middle-income nations led the company to cut its annual revenue expectation by half.
Demand for its vaccine has waned in the United States, where it was authorized for use among adults last month, and was expected to be preferred by the skeptics of messenger RNA-based shots from Moderna Inc and Pfizer Inc.
Chief Executive Stanley Erck said that its late launch could have hampered demand, as only 7,381 Novavax vaccine doses have been administered in the country.
Cowen analyst George Yordanov said that the forecast cut hurts any hopes of Novavax being able to garner a share of the market for the two-dose initial vaccine program.
In a note, he said that he fully understands investors' frustration with management's execution and lack of accurate near-term guidance.
The company is expected to capture a small but meaningful share of a fast-developing market for COVID vaccines, according to analysts.
Jefferies analyst Roger Song said that it could still be a viable COVID vaccine player in the future $5-10 billion market, as it has shown comparable better clinical profile compared to mRNA vaccines.
Novavax shares were trading lower at $39.30 before the bell. Rival Moderna Inc was down about 3%. Unallocated vaccines were offset by gains from orders for new booster shots, according to a report by the COVAX program.