Pomerantz Settles Securities Litigation with Novavax for $47 Million

Pomerantz recently achieved a $47 million settlement on behalf of defrauded investors in a securities litigation against the American biotechnology company Novavax. The suit revolves around allegedly misleading statements made regarding the development and imminent approval of the company’s Covid-19 vaccine candidate. According to the complaint, the Defendants misrepresented the successful development, production, and imminent FDA approval of the vaccine, despite severe manufacturing issues that jeopardized its approval and market viability.

In early 2020, a government grant put Novavax in prime position to capitalize on the market for a Covid-19 vaccine. However, the company's vaccine production efforts allegedly fell short of FDA safety requirements due to manufacturing problems, including contamination events at their U.S. facilities. These issues led to delays in regulatory submissions and an inability to produce vaccines at scale. Despite these challenges, Defendants reassured investors of the vaccine program's success, causing Novavax's stock to remain high.

Defendants personally profited from these misrepresentations, selling millions of dollars worth of shares just prior to announcing costly delays. The truth about the vaccine's failure was revealed in October 2021 through a Politico article detailing Novavax's manufacturing problems and regulatory hurdles. This revelation caused Novavax's stock to plummet, injuring investors who relied on Defendants' false statements. Over the class period, Novavax stock collectively fell over 50% in response to revelations about the company’s manufacturing issues.

Pomerantz’s litigation team was led by Managing Partner Jeremy A. Lieberman and Partner Brian Calandra.