Last Updated on October 19, 2020 by admin
What occurred
Vaxart (NASDAQ:VXRT), a clinical-stage vaccine developer, is poised for a tricky day right this moment. Forward of the opening bell, the biotech’s shares dropped by as a lot as 9.9%.
The wrongdoer? Vaxart’s inventory is sinking this morning in response to an Eight-Okay filed with the Securities and Trade Fee (SEC) final Wednesday. Within the submitting, Vaxart revealed that it’s at present beneath investigation by the federal authorities and the SEC for its prior claims about being chosen by Operation Warp Velocity (OWS). What’s extra, the corporate additionally launched particulars relating to the continuing class motion lawsuits filed by a few of its shareholders over the identical matter.
Picture supply: Getty Photographs.
Vaxart’s shares have rebounded to some extent for the reason that opening bell, however they’re nonetheless down by 5.2% as of 9:46 a.m. EDT Monday.
So what
Final June, Vaxart introduced that its oral COVID-19 vaccine was chosen to take part in OWS, the federal authorities’s program to speed up the event of vaccines and therapeutics to combat the virus. Because of this, the biotech’s shares shot up by a whopping 500% over only a three-week interval in the summertime.
Traders apparently took the press launch in query to imply that Vaxart was in line to obtain a big grant for its COVID-19 vaccine program. The reality, nevertheless, was that the corporate’s vaccine was merely chosen to take part in a nonhuman primate problem research. Vaxart, in brief, didn’t land a large award from OWS on the time of that specific press launch.
Now what
Is that this dip a shopping for alternative? Vaxart’s press launch over the OWS matter did not explicitly state that the corporate had acquired a big award — solely that the primate problem research can be sponsored by OWS. So it is exhausting to think about that investigators will have the ability to definitively show that the corporate purposely deceived shareholders in an effort to inflate its share worth. That is the silver lining.
Having mentioned that, buyers additionally want to grasp that Vaxart’s COVID-19 oral vaccine program is much from a positive factor. This developmental biotech inventory, subsequently, in all probability belongs solely within the portfolios of essentially the most aggressive of buyers.
