Believes the two new nominated directors possess the necessary experience to tackle the underperformance of the business which will improve its share price
Shah Capital which owns 6.7% of Novavax, in a letter to the board says that the low share price reflects the board and management’s failure to capitalize on Novavax’s many significant competitive advantages and TAM opportunities
The letter highlights that the underperformance is self-inflicted and is the result of reactive leadership and outdated and old-fashioned marketing
RALEIGH, N.C., April 15, 2024 (GLOBE NEWSWIRE) -- Shah Capital, which owns approximately 6.7% of the outstanding common stock of Novavax (NASDAQ: NVAX), has today issued the below statement:
“As a long-term strategic investor in Novavax, Shah Capital has been deeply disappointed in its performance and the failure of its leadership to realize shareholder value reflective of Novavax’s significant competitive advantages and sizeable market opportunity.
“Over a period of more than a year, Shah Capital has engaged repeatedly with the board and made several suggestions aimed at addressing self-inflicted problems which have undermined the success and sustainability of the company. However, the board has regrettably been unresponsive. Following this subsequent inaction by Novavax, which is now trading at a near record low and is one of the most shorted stocks on the Nasdaq, Shah Capital has been forced to make public its concerns and call for leadership change.
“Recognizing this pressing need for Novavax to offer the investment community a more proactive and innovative strategy, Shah Capital is strongly recommending the appointment to the board of two new independent directors:
- Suresh Katta, founder of Saama and CEO of the company for 25 years
- Venkat Peri, CEO of Quantiva Health a healthcare company that is putting AI and advanced computational sciences at the intersection of medicine, biology, and healthcare economics
“Together these two individuals have the pragmatic knowhow and technology experience to help the board address many of the key issues we have identified as value destroyers for Novavax. These include colossal marketing failures, a non-existent partnership strategy, no clear understanding of technology, questionable regulatory management, and ongoing operating losses and inefficiencies. Together these have contributed to a market capitalization to 2024 expected sales ratio of only 1X, compared to the 10X valuation possessed by its peer Moderna. This demonstrates clearly the lack of investor confidence in the business which has been made worse by the recent massive dilutive share issuance. “It is the view of Shah Capital therefore that Novavax must urgently adopt a more innovative and dynamic sales and marketing strategy. Targeting key Covid segments, such as direct-to-patient outreach for individuals aged 60+ and residents of southern states is crucial, as is effective regulatory stakeholder management, particularly with the FDA. Furthermore, Novavax should turn its Matrix-M adjuvant franchise’s inactive pipeline candidates (such as Flu, RSV, and H5N1) into active opportunities through outside capital infusion. Lastly, efficient and effective spending is necessary for operational profitability in 2024 and beyond.
“Possessing interests aligned with all Novavax shareholders, Shah Capital is invested in the long-term success of the company and believes that, despite the issues outlined above, its Matrix-M adjuvant vaccine franchise has an extremely bright future. This potential is well supported by compelling data from the Center for Disease Control (CDC) which supports its effectiveness as an early-season vaccine, especially when compared to mRNA peers. In addition, the untapped market of approximately 100 million US citizens averse to mRNA vaccines presents a significant opportunity. It is unfathomable that given the sheer size of Novavax’s unique market opportunity that the present team was only able to achieve ~200,000 jabs nationwide in Fall 2023 season. This failure was not due to lack of demand, but instead was a function of marketing missteps, rollout issues and delays that simply would not happen with a sharper more focused team. Novavax can have over 50% covid market share this fall season if they play their cards right.
“It is for these reasons outlined above that Shah Capital is calling for an end to the historic mismanagement of this business. We are confident that the appointment of these two highly experienced individuals to the board will be a crucial first step to moving beyond what has been an ineffective and old-fashioned strategic approach in favor of one that can finally begin maximizing value for Novavax’s shareholders.” Also, given the Board’s inability to execute, inflexible nature and unwillingness to adapt, there may very well need to be even more shareholder representation beyond the two seats that we are recommending, and we are open to exploring this concept further.
Director Candidate Bios:
Suresh Katta:
Suresh founded Saama Technologies in 1997 with a vision to provide unattainable insights from raw data across disparate sources using game-changing analytics solutions for Fortune companies. Over the last 25 years, he served as Saama’s CEO, leveraging AI to reshape businesses across different verticals, including Life Sciences, Insurance, CPG, and High-Tech.
In June 2022, Suresh was elevated to Chairman Emeritus of Saama’s Board, following his leadership in stewarding Saama’s partnership with Pfizer to develop the world’s first COVID-19 vaccine in less than one year. In 2021, he architected a bold new strategic growth investment of approximately $500M for Saama with global investment firm Carlyle and a unique consortium of the corporate venture arms of major pharmaceutical companies, including Pfizer, Merck, Amgen, and McKesson.
Before founding Saama, Suresh had an early career at Silvar-Lisco, a chip software company, and Silicon Graphics, a 3D workstation company.
As one of the world’s most inspiring data & analytics (D&A) innovators, Suresh served on the Board of Directors of the Association of Clinical Research Organizations (ACRO), advocating for safe, ethical clinical trials that protect patients and ensure high-quality results. In recognition of his contributions, Suresh was named PM360’s ELITE Entrepreneur and one of PharmaVOICE’s 100 Most Inspirational Leaders. He frequently contributes to industry publications and is a sought-after featured speaker for industry conferences and panels. Prior to founding Saama, Suresh successfully launched two startups.
Suresh also serves as a board member at the Stimson Center, one of the top think tanks headquartered in Washington, DC, known for its leadership on critical global issues. In addition, Suresh is associated with various charitable programs that provide educational assistance for the less fortunate. Suresh serves as a board member at OneCellDx, an early cancer diagnostics company working at the intersection of breakthrough sciences and AI. Suresh also serves on the board of Ceremorphic, an ultra-low-power supercomputing AI chip company.
Suresh received honorary doctorates from MIT ADT University and DY Patil Universities in India for his contributions to uplifting humanity during the crisis. He earned his M.S. in Computer Engineering from the University of Southwest Louisiana and his B.S. in Electronics Engineering from the University of Bangalore, India.
Venkat Peri:
Venkat (aka, PV) is the CEO of Quantiva Health, a cutting-edge Healthcare company that is putting AI and advanced computational sciences at the intersection of medicine, biology, and healthcare economics. Quantiva Health’s solutions have been proven, patented, and piloted with real-life healthcare data and have delivered path-breaking accuracy in detecting the presence, severity, and progression of diseases. Quantiva Health’s approach and solutions are solving some of the most challenging impediments of healthcare including precision targeting and interventions; optimizing resource allocation; spotting and managing the cohorts with rising risks to save hundreds of millions for payers and providers including Medicaid and Medicare. Over the past 2 years, Quantiva Health has built a robust pipeline of solutions for maternal and infant health; sepsis; vision anomalies; hepatic risks and CKD.
Prior to starting Quantiva Health, PV spent more than 3 decades in management consulting and product development and served in global leadership roles as a Senior Partner at PwC, Deloitte, and IBM delivering more than $1B in revenues across financial services, healthcare, business analytics & optimization, and risk assurance and analytics. In addition to his P&L responsibilities, PV had served as a personal advisor to CXOs, Boards and Governments leveraging his deep understanding of technology and AI to shape their perspectives to harness technology, AI, and global talent for value creation.
As a practitioner, PV did seminal work in areas of - personalized targeting and pricing for a diverse range of products from medicines to loans to policy premiums; restructuring NPAs post the sub-prime crisis; tax reforms for enhanced revenue collection and reducing defaults; terrorism surveillance to spot bad actors in society.
PV is a compelling speaker and conducts case-based simulations for graduate students in engineering and business at a few leading universities globally. PV holds a master’s degree in public administration from the London School of Economics and Political Science and a master’s degree in computer science and applications from the National Institute of Technology, Rourkela, India.
About Shah Capital:
Shah Capital is a global investment firm employing a focused investment philosophy with an emphasis on turnarounds and special situations.
Contacts:
| Citigate Dewe Rogerson Caroline Merrell Christen Thomson | caroline.merrell@citigatedewerogerson.com christen.thomson@citigatedewerogerson.com |
