Vaxart in the hot seat for exaggerating role in OWS

Oct. 14, 2020

It’s no secret that pharma companies reporting positive news related to Operation Warp Speed investments have seen their stock prices soar. The same was true for Vaxart, a clinical-stage biotech, that announced in June that its vaccine candidate was selected for the federal initiative, which is doling out billions of dollars to support vaccine development and manufacturing. Before the announcement, Vaxart was reportedly trading at about $3 per share. But after the big news? The price skyrocketed to $17.

The only problem is that Vaxart may not be as involved in OWS as it let on. 

According to a New York Times report in July, Vaxart’s candidate had been chosen to be included in a trial on primates — but the company was not being given the kind of financial backing that other pharma companies have received.

Now, the company has revealed in an SEC filing that it was slapped with a grand jury subpoena in July related to an investigation by the Office of the U.S. Attorney for the Northern District of California. The grand jury is asking for several documents that “broadly pertain to the Company's participation in, and disclosure of, an Operation Warp Speed . . . funded nonhuman primate study, and option grants, warrant transactions, and other corporate financing matters."

On top of that, the company is facing an investor lawsuit alleging that the company released misleading statements to make it sound like it was playing a larger role in OWS.

The legal revelations came just after the company did report positive news related its candidate, an oral tablet vaccine for COVID-19. According to a press release, the company has officially launched a phase 1 dosing trial on 48 participants between 18 and 54 years old.