Investopedia: Novavax Gets A Booster Shot From The Government

While the FDA seems to be relishing its role as Little Bunny Foo Foo these days, other arms of the U.S. government are actually trying to be helpful when it comes to getting new drugs and vaccines to market. The government may have actually learned a thing or two when the H1N1 flu outbreak in 2009 took health officials by surprise, and Tuesday's contract announcement with Novavax (Nasdaq:NVAX) suggests that the U.S. healthcare system would rather not be caught unaware next time. (For background reading, see Measuring The Medicine Makers.)

The Terms of the Novavax Deal  
Novavax announced that the Biomedical Advanced Research and Development Authority (BARDA), part of the Department of Health and Human Services, decided to award a contract worth as much as $179 million to Novavax to help the company develop and manufacture vaccines for seasonal and pandemic influenza. Although Novavax had been working with BARDA for some time and was generally seen as very likely to get something, the final details were always up in the air. (For more, see Trading The Swine Flu Index.)

Now, though, the company knows that it will get a three-year contract worth almost $100 million ($97 million), with the potential of a two-year extension worth another $82 million. Generally speaking, these contracts are solid and dependable, so Novavax will not have to worry about whether year-to-year budget wrangling will leave them high and dry; so long as the company holds up its end of the bargain, the money should be there. 


Please read the full article at Investopedia:
http://stocks.investopedia.com/stock-analysis/2011/Novavax-Gets-A-Booster-Shot-From-The-Government-NVAX-NVS-GSK-SNY-MRK-JNJ-AZN0301.aspx