In the spring of 2020, Vaxart began development of an COVID-19 vaccine candidate. Vaxart’s shares had been trading around $3.00 per share. On June 26, 2020,Vaxart issued a news release announcing that it had been selected for the federal initiative Operation Warp Speed to quickly develop drugs to combat COVID-19. On this announcement, shares of Vaxart soared, reaching intraday trading prices in excess of $17.00.
The truth was more complex. On July 25, 2020, the New York Times published an article entitled “Corporate Insiders Pocket $1 Billion in Rush for Coronavirus Vaccine.” This article provides that Vaxart’s COVID-19 vaccine candidate was included in a trial on primates that a federal agency organized in conjunction with Operation Warp Speed. However, Vaxart is not among the companies selected to receive significant financial support from Operation Warp Speed. On July 25, 2020, the New York Times published an article entitled “Corporate Insiders Pocket $1 Billion in Rush for Coronavirus Vaccine.” This article quoted Michael R. Caputo, the U.S. Department of Health and Human Services’ assistant secretary for public affairs, that the Department “has entered into funding agreements with certain vaccine manufacturers, and we are negotiating with others. Neither is the case with Vaxart.” The New York Times article continued that “[s]ome officials at the [DHHS] have grown concerned about whether companies including Vaxart are trying to inflate their stock prices by exaggerating their roles in Warp Speed . . . . The [DHHS] has relayed those concerns to the” SEC. The New York Times article further provided that Vaxart’s largest shareholder, hedge fund Armistice Capital, obtained newly amended warrants to buy 21 million Vaxart shares and immediately sold them, making an immense $197 million profit while the share price had soared.
On this news, Vaxart shares have plummeted, trading as low as $9.16 on July 27, 2020.
Investors who have lost money on their Vaxart shares may be able to recover some of those losses, and should contact us using the form below.