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NVAX.US
id: 912

Novavax (NVAX) $47M Investor Settlement over COVID vaccine promises

Late claims are being considered for compensation, subject to approval.
D. Maryland
Court
8:21-cv-02910
Case number
05/11/2021
Class period Start
10/19/2021
Class period End
05/18/2024
Claim deadline
Investors have reached a $47 million settlement with Novavax. They claim the company made false and misleading statements about its COVID-19 vaccine production and regulatory timeline. Novavax is accused of overstating its manufacturing capabilities and not revealing the production delays that affected the approval of its vaccine, NVX-CoV2373. This led to financial losses for investors who bought shares during the specified period.

Outline


The lawsuit focuses on allegations that Novavax's leadership misled the public about the company’s ability to meet its regulatory goals for the COVID-19 vaccine. Despite internal issues, Novavax continued to reassure investors that the production was on track. However, in October 2021, Novavax admitted to delays in its Emergency Use Authorization (EUA) application, causing a drop of 14.7% in the stock price.

Timeline of Key Events

  • February 24, 2021: Novavax makes optimistic public statements about its COVID-19 vaccine progress.
  • October 19, 2021: Novavax announces delays in regulatory approval due to production issues.
  • November 12, 2021: A class-action lawsuit is filed, accusing Novavax of misleading investors.
  • December, 2023: Novavax agreed to a $47 million settlement with investors.

Background


Novavax gained attention during the COVID-19 pandemic with its vaccine candidate, NVX-CoV2373. As the vaccine race intensified, Novavax's stock surged in value. The company repeatedly told investors it was on track to get Emergency Use Authorization (EUA) for the vaccine. However, significant production challenges and supply chain disruptions were causing delays, which the company did not disclose.
Throughout 2021, company executives, including CEO Stanley Erck, made statements that reassured investors about the progress of the vaccine. However, behind the scenes, the company was grappling with production quality issues that severely impacted its ability to meet regulatory deadlines. These undisclosed issues created a false sense of confidence for investors.

On October 19, 2021, Novavax publicly admitted that it would miss the anticipated approval timelines due to manufacturing problems. This revelation caused a steep decline in Novavax's stock price, with investors suffering significant losses. On May 10, 2021, the stock dropped by 9% and an additional 13.9% following the investor call. Further delays on August 5, 2021, led to a 19% decline. Then, on October 19, 2021, a report on manufacturing issues triggered another 14.7% drop. In total, these events contributed to more than a 40% reduction in the stock's value during this period. As a result, they filed a class-action lawsuit against Novavax, claiming that the company misrepresented its capabilities and downplayed risks related to vaccine production.

What Can Investors Expect Now?


Novavax has agreed to a $47 million settlement with investors to resolve claims that it misled them about the company’s COVID-19 vaccine production and regulatory timeline.

If you were damaged due to this situation, you can file for a payout and get your share of the settlement. You can check if you are eligible and other details in the FAQ section below.
Case Status
Accepting Late Claims
Alleged Offence
Misleading Statements, 
Failure to Disclose, 
Omissions
Suspected Party
Directors, 
Management
Security Type
Stocks
Trade Direction
Long
Payout per Share
1.24
Filing date
11/12/2021
Lead Plaintiff Deadline
01/11/2022
Plaintiffs
Jeffrey A. Gabbert, Nuggehalli Balmukund Nandkumar, David Truong
Attorneys
Cohen Milstein Sellers & Toll PLLC (Washington, DC), Labaton Sucharow LLP (New York, NY), Pomerantz LLP (New York, NY), Portnoy Law Firm (Los Angeles, CA)
Defendants
Stanley C. Erck, Gregory F. Covino, John J. Trizzino, Gregory M. Glenn
Judge
Hon. Theodore D. Chuang
Administrator
Strategic Claims Services
Court hearing date
05/23/2024
Exclusion deadline
05/02/2024
Objection deadline
05/02/2024
Class wide damages
$2,351,400,000
Trades matching type
FIFO
+$47,000,000
Cash Settlement Amount

Frequently Asked Questions

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Do I have to sell securities to be eligible?
How much will my payment be?
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