Sanofi has signed a $1.2bn licensing agreement with Novavax to co-commercialise its stand-alone adjuvanted Covid-19 vaccine.

Starting in 2025, the drugmaker will co-commercialise the vaccine worldwide, except for in countries such as India, South Korea, and Japan where Novavax already has existing partnerships in place. As per the “co-exclusive” agreement, Sanofi will also support certain R&D, regulatory, and commercial expenses.

The American vaccine company has faced tough times in the post-Covid-19 landscape, going as far as to issue a “going concern” warning in 2023 about its ability to continue operating. At the time, Novavax said it was subject to “significant uncertainty” concerning future sales and funding from the US Government.

Following the deal with Sanofi, the removal of this warning was noted in Novavax’s first quarter 2024 financial results and operational highlights released today.

Novavax CEO John Jacobs told CNBC that the agreement with Sanofi would allow it to lift the “going concern” warning it first issued last year over doubts surrounding its ability to continue operations.

The Q1 financials show that Novavax achieved revenues of $94m in its first quarter, up from $81m in the same period in 2023.

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While Novavax’s adjuvanted Nuvaxovid (NVX-CoV2373) vaccine is not currently approved or licensed by the US Food and Drug Administration (FDA), it has been authorised by the agency under an emergency use authorisation (EUA) to prevent Covid-19 for use in individuals aged 12 and above. The EUA was amended late last year to incorporate the 2023-2024 version.

Last year, Novavax received a full marketing authorisation from the European Medicines Agency (EMA) for Nuvaxovid. The vaccine has been authorised in more than 40 markets worldwide.

The deal also gives Sanofi a sole licence to use the vaccine in combination with its flu vaccines, and non-exclusive licences to use it in combination with non-flu vaccines and Novavax’s Matrix-M adjuvant in vaccine products.

The Matrix-M adjuvant comprises naturally occurring compounds found in the bark of the soap bark tree, which is commonly found in Chile. According to Novavax, the combination of ingredients has been shown to enhance the immune system response to its vaccines.

Jean-Francois Toussaint, global head of vaccines R&D at Sanofi, commented: “With flu and Covid-19 hospital admission rates now closely mirroring each other, we have an opportunity to develop non-mRNA flu-Covid-19 combination vaccines offering patients both enhanced convenience and protection against two serious respiratory viruses.”

Jacobs added: “Novavax is now in a stronger position to refocus our efforts on leveraging our technology platform and novel adjuvant in research and development and pipeline expansion to help advance our mission of developing life-saving vaccines to fight infectious diseases.”

According to GlobalData analysts, Sanofi was the tenth top pharmaceutical company by R&D spend in 2023. The company’s R&D expenditure totalled $7.18bn, making its R&D budget 15.6% of its revenue.

GlobalData is the parent company of Pharmaceutical Technology.