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Item 1A. Risk Factors

2021-11-05 compared with 2021-08-05 · 95 added, 98 removed, 784 unchanged (20% of the section changed)

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• We are conducting, and plan to conduct in the future, a number of clinical trials for NVX-CoV2373 at sites outside the United States and the FDA may not accept data from trials conducted in such locations.

• Even if regulatory approval is received for our vaccine candidates, the later discovery of previously unknown problems with a product, manufacturer or facility may result in restrictions, including withdrawal of the product from the market, or may mean that product we have produced prior to regulatory approval is not acceptable for sale in one or more markets.

• Our success depends on our ability to maintain the proprietary nature of our technology.

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• Because our stock price has been and will likely continue to be highly volatile, the market price of our common stock may be lower or more volatile than expected.

• Litigation could have a material adverse impact on our results of operation and financial condition.

• Litigation or regulatory investigations could have a material adverse impact on our results of operation and financial condition.

• We or the third parties upon whom we depend may be adversely affected by natural or man-made disasters or public health emergencies, such as the COVID-19 pandemic.

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We have a history of losses and our future profitability is uncertain.

Our expenses have exceeded our revenue since our formation in 1987, and our accumulated deficit at June 30, 2021 was $2.4 billion.

Our expenses have exceeded our revenue since our formation in 1987, and our accumulated deficit at September 30, 2021 was $2.8 billion.

Our revenues and expenses fluctuate significantly from period to period.

For most of our history our expenses have exceeded our revenues, which may occur during most periods in the foreseeable future.

For most of our history our

expenses have exceeded our revenues, which may occur during most periods in the foreseeable future.

Our net losses for the last three fiscal years were $418.3 million in 2020, $132.7 million in 2019 and $184.7 million in 2018.

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Our expenses have exceeded our revenue since inception, and we believe our expenses will fluctuate over time, and may substantially increase in some years, as a result of continuing efforts to develop, test, manufacture, and make regulatory filings for our vaccine candidates, and, if our product candidates are approved, commercialization efforts.

As of the end of the second quarter of 2021, our investment in the development and manufacture of NVX-CoV2373 has been substantial, and we expect such levels of investment to continue for the rest of 2021 and beyond, although the precise magnitude of our total investment will depend on the duration of the COVID-19 pandemic, the competitive landscape, the timing and results of our applications for regulatory approvals, the availability of funding, and whether and what booster shot protocols are recommended by governments, regulatory authorities, and healthcare providers.

As of the end of the third quarter of 2021, our investment in the development and manufacture of NVX-CoV2373 has been substantial, and we expect such levels of investment to continue for the rest of 2021 and beyond, although the precise magnitude of our total investment will depend on the duration of the COVID-19 pandemic, the competitive landscape, the timing and results of our applications for regulatory approvals, the availability of funding, and whether and what booster shot protocols are recommended by governments, regulatory authorities, and healthcare providers.

If we are unable to timely commercialize a vaccine against COVID-19, we likely would never recoup our investments.

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Furthermore, negative interpretations of clinical trial data or setbacks, or perceived setbacks, with respect to manufacturing ability and/or capacity or regulatory filing timelines for NVX-CoV2373 or our other vaccine candidates, as well as the competitive landscape posed by other COVID-19 vaccines, may impair our ability to raise additional financing on favorable terms, or at all.

Additionally, certain of the supply agreements for NVX-CoV2373 may be terminated by the counterparty if we do not timely achieve requisite regulatory approval for NVX-CoV2373 in the relevant jurisdictions under such agreements.

If we cannot raise the additional funds required for our anticipated operations, we may be required to delay significantly, reduce the scope of or eliminate one or more of our research or development programs, downsize our organization, or seek alternative measures to avoid insolvency, including arrangements with collaborative partners or others that may require us to relinquish rights to certain of our technologies or vaccine candidates.

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We may be unable to timely obtain additional government or private funding, if at all.

Additionally, we have entered into, and plan to continue entering into, supply agreements for NVX-

CoV2373 that include prepayments from the purchasers.

In the event we are unable to successfully develop and commercialize NVX-CoV2373 or fail to meet certain product volume or delivery timing obligations under our supply agreements, we may be required to refund significant portions of the prepayments, which could have a material and adverse effect on our financial condition.

Additionally, we have entered into, and plan to continue entering into, supply agreements for NVX-CoV2373 that include prepayments from the purchasers.

Certain of the supply agreements may be terminated by the counterparty if we do not timely achieve requisite regulatory approval for NVX-CoV2373 in the relevant jurisdictions under such agreements.

In the event we are unable to successfully develop and commercialize NVX-CoV2373 or fail to meet certain regulatory milestones or product volume or delivery timing obligations under our supply agreements, we may be required to refund significant portions of the prepayments, which could have a material and adverse effect on our financial condition.

Our inability to succeed with key clinical or development activities could jeopardize our ability to obtain licensure from the FDA or other regulatory authorities to sell NVX-CoV2373.

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• the products are difficult to manufacture on a large-scale or uneconomical to market;

• some or all of the products that we or our third-party partners have manufactured may be determined to be unsalable based on criteria imposed by regulators as they complete regulatory approvals;

• our in-house or third-party manufacturing facilities fail regulatory inspections;

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We have not previously had a commercial launch of any vaccine product, and doing so in a pandemic environment with an urgent, critical global need creates additional challenges.

In addition to scaling up our manufacturing capabilities, we

need to develop global distribution channels and form partnerships with third parties worldwide, as well as hire, train and integrate additional management, administrative and sales and marketing personnel.

In addition to scaling up our manufacturing capabilities, we need to develop global distribution channels and form partnerships with third parties worldwide, as well as hire, train and integrate additional management, administrative and sales and marketing personnel.

Rapid and significant growth may strain our administrative and operational infrastructure, imposing significant additional responsibilities on our organization, and our efforts to establish these capabilities may not meet expectations as to timing, scale-up, reproducibility, yields, purity, cost, potency or quality.

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Further, success in clinical trials often leads to increased investment, accelerating cumulative losses.

Even if clinical trial results appear positive, regulatory approval may not be obtained if the FDA does not agree with our interpretation of the results, and we may face challenges when scaling-up the production process to commercial levels.

Even after a product is approved and launched, general usage or post-marketing clinical trials may identify safety or other previously unknown problems with the product, or manufacturing issues may emerge, either of which may result in regulatory approvals being suspended, limited to narrow the scope of the approval, or revoked, which may otherwise prevent successful commercialization.

Even if clinical trial results appear positive, regulatory approval may not be obtained if the FDA, or a foreign equivalent, does not agree with our interpretation of the results, and we may face challenges when scaling-up the production process to commercial levels.

Even after a product is approved and

launched, general usage or post-marketing clinical trials may identify safety or other previously unknown problems with the product, or manufacturing issues may emerge, either of which may result in regulatory approvals being suspended, limited to narrow the scope of the approval, or revoked, which may otherwise prevent successful commercialization.

Intense competition in the vaccine industry could also limit the successful commercialization of any products for which we receive commercial approval.

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Not achieving the primary clinical endpoint has been viewed negatively by our investors.

Although the failure to achieve the primary endpoint in the trial is not evidence that the vaccine is

ineffective, it means that regulatory agencies like the FDA and EMA are likely to require additional clinical trial data prior to licensure.

Although the failure to achieve the primary endpoint in the trial is not evidence that the vaccine is ineffective, it means that regulatory agencies like the FDA and EMA are likely to require additional clinical trial data prior to licensure.

This development may be viewed negatively by our potential collaborators and partners, which may make the ongoing development of ResVax, and any other RSV F Vaccine candidates, more challenging.

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Past success in establishing strategic collaborations with pharmaceutical and biotechnology companies, non-profit organizations and government agencies in the past is no guarantee of future success in entering into new relationships or in performing under existing relationships.

If we fail to establish a sufficient number of collaborations or government relationships on acceptable terms, or fail to perform under collaborations or

relationships to the satisfaction of counter-parties, we may not be able to commercialize our vaccine candidates or generate sufficient revenue to fund further research and development efforts.

If we fail to establish a sufficient number of collaborations or government relationships on acceptable terms, or fail to perform under collaborations or relationships to the satisfaction of counter-parties, we may not be able to commercialize our vaccine candidates or generate sufficient revenue to fund further research and development efforts.

The collaborations we have established or may establish may not result in the successful development or commercialization of any vaccine candidates for several reasons, including the fact that:

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Third-party payers are increasingly challenging the prices charged for medical products and may deny coverage or offer inadequate levels of reimbursement if they determine that a prescribed product has not received appropriate clearances from the FDA, or foreign equivalent, or other government regulators;

is not used in accordance with cost-effective treatment

methods as determined by the third-party payer;

is not used in accordance with cost-effective treatment methods as determined by the third-party payer;

or is experimental, unnecessary or inappropriate.

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For example, in 2017, the Trump administration withheld the cost-sharing subsidies paid to ACA health insurance exchange plans serving low-income enrollees.

The Tax Cut and Jobs Act (“TCJA”) was also enacted at the end of 2017 and included provisions that affected healthcare insurance coverage and payment, such as the elimination of the tax penalty for individuals who do not maintain sufficient health insurance coverage beginning in 2019 (the so-called “individual mandate”).

The Tax Cut and Jobs Act

(“TCJA”) was also enacted at the end of 2017 and included provisions that affected healthcare insurance coverage and payment, such as the elimination of the tax penalty for individuals who do not maintain sufficient health insurance coverage beginning in 2019 (the so-called “individual mandate”).

More recently, the Biden administration, through the American Rescue Plan Act of 2021, increased subsidies for coverage purchased through ACA health insurance exchanges and extended eligibility for subsidies to higher income levels.

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We have entered into regional collaborations to develop, manufacture and distribute our vaccine candidates in certain parts of the world, and we anticipate entering into additional regional collaborations.

Our relationships with SIIPL, Cadila and BMGF are examples of these regional relationships.

Our relationships with SIIPL, Takeda, SK bioscience and BMGF are examples of these regional relationships.

These relationships often involve the licensing of our technology to our partner or entering into a distribution agreement, frequently on an exclusive basis.

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Loss in vaccine candidates could occur if the product or product intermediates are not stored or handled properly.

It is possible that our vaccine candidates could be lost due to expiration prior to use.

It is possible that our vaccine candidates could be lost due

to expiration prior to use.

If we do not effectively maintain our supply logistics, then we may experience an unusual number of returned or out of date products.

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Regardless of the disease, smaller or early-stage companies and research institutions also may prove to be significant competitors, particularly through collaborative arrangements with large and established pharmaceutical companies.

As these companies develop their technologies, they may develop proprietary positions, which may prevent or limit our product development and commercialization efforts.

companies develop their technologies, they may develop proprietary positions, which may prevent or limit our product development and commercialization efforts.

We will also face competition from these parties in recruiting and retaining qualified scientific and management personnel, establishing clinical trial sites and participant registration for clinical trials and in acquiring and in-licensing technologies and products complementary to our programs or potentially advantageous to our business.

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Competition in the sale of these seasonal influenza vaccines is intense.

Therefore, newly developed and approved products must be differentiated from existing vaccines

in order to have commercial success.

Therefore, newly developed and approved products must be differentiated from existing vaccines in order to have commercial success.

In order to show differentiation in the seasonal influenza market, a product may need to be more efficacious, particularly in older adults, and/or be less expensive or quicker to manufacture.

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Foreign regulatory authorities may apply similar limitations or may refuse to grant any approval.

Consequently, even if we believe that preclinical and clinical data are sufficient to support regulatory approval for our vaccine candidates, the FDA and foreign regulatory authorities ultimately may not grant approval for commercial sale in any jurisdiction, or may impose regulatory

requirements that make further pursuit of approval uneconomical in one or more jurisdictions.

If our vaccine candidates are not approved, our ability to generate revenue will be limited, and our business will be adversely affected.

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Delays in obtaining regulatory approval can be extremely costly in terms of lost sales opportunities, loss of any potential marketing advantage of being early to market and increased clinical trial costs.

For example, certain of our APAs and supply agreements may be terminated by the counterparty if we do not timely achieve requisite regulatory approval for NVX-CoV2373 in the relevant jurisdictions under such agreements.

The speed with which we begin and complete our preclinical studies necessary to begin clinical trials, clinical trials and our applications for marketing approval will depend on several factors, including the following:

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The approval procedure varies among countries and can involve additional testing and data review.

The time required to obtain foreign

regulatory approval may differ from that required to obtain FDA approval.

The time required to obtain foreign regulatory approval may differ from that required to obtain FDA approval.

The foreign regulatory approval process may include all of the risks associated with obtaining FDA approval.

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We are conducting, and plan to conduct in the future, a number of clinical trials for NVX-CoV2373 at sites outside the United States and the FDA may not accept data from trials conducted in such locations.

We are currently conducting several clinical trials of NVX-CoV2373 at sites outside the U.S., including a Phase 3 trial in the U.K., a Phase 2b trial in South Africa, and a Phase 1/2 trial partially in Australia.

We also plan in the future to conduct (or collaborate to conduct) a Phase 2/3 trial in India, Phase 2 trial in the Czech Republic, and Phase 1/2 trial in Japan.

We are currently conducting several clinical trials of NVX-CoV2373 at sites outside the U.S., including a Phase 3 trial in the U.K., a Phase 2b trial in South Africa, a Phase 1/2 trial partially in Australia, a Phase 2/3 trial in India, and a Phase 1/2 trial in Japan.

Although the FDA may accept data from clinical trials conducted outside the U.S., acceptance of these data is subject to conditions imposed by the FDA.

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or result in the need for additional trials, which would be costly and time-consuming and could delay or permanently halt our development of NVX-CoV2373.

Even if regulatory approval is received for our vaccine candidates, the later discovery of previously unknown problems with a product, manufacturer or facility may result in restrictions, including withdrawal of the product from the market, or may mean that product we have produced prior to regulatory approval is not acceptable for sale in one or more markets.

Even after a product gains regulatory approval, the product and the manufacturer of the product will be subject to continuing regulatory review, including adverse event reporting requirements and the FDA’s general prohibition against promoting products for unapproved uses.

Failure to comply with any post-approval requirements can, among other things, result in warning letters, product seizures, recalls, substantial fines, injunctions, suspensions or revocations of marketing licenses, operating restrictions and criminal prosecutions.

Any such enforcement actions, any unanticipated changes in existing

regulatory requirements or the adoption of new requirements, or any safety issues that arise with any approved products, could adversely affect our ability to market products and generate revenue and thus adversely affect our ability to continue our business.

Any such enforcement actions, any unanticipated changes in existing regulatory requirements or the adoption of new requirements, or any safety issues that arise with any approved products, could adversely affect our ability to market products and generate revenue and thus adversely affect our ability to continue our business.

We also may be restricted or prohibited from marketing or manufacturing a product, even after obtaining product approval, if previously unknown problems with the product or its manufacture are subsequently discovered.

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Government under the Defense Production Act of 1950, as amended, that directly or indirectly have the effect of diminishing some of our rights or opportunities with respect to NVX-CoV2373, and the economic value of a COVID-19 vaccine to us could be limited.

In addition, during a global health crisis, such as the COVID-19 pandemic, where the spread of a disease needs to be controlled, closed or heavily regulated national borders create challenges and delays in our development, production and distribution activities and may necessitate that we pursue strategies to develop, produce and distribute our vaccine candidates within self-contained national or international borders or with additional safety measures or checks in place, at potentially much greater expense and with longer timeframes for public distribution.

In addition, during a global health crisis, such as the COVID-19

pandemic, where the spread of a disease needs to be controlled, closed or heavily regulated national borders create challenges and delays in our development, production and distribution activities and may necessitate that we pursue strategies to develop, produce and distribute our vaccine candidates within self-contained national or international borders or with additional safety measures or checks in place, at potentially much greater expense and with longer timeframes for public distribution.

Inadequate funding for the FDA, the SEC and other government agencies could hinder their ability to hire and retain key leadership and other personnel, or otherwise perform their normal functions on which the operation of our business may rely, which could negatively impact our ability to develop or commercialize new products or services, access capital markets, or otherwise operate our business.

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Obtaining a Fast Track Designation does not change the standards for product approval, but may expedite the development or approval process.

Even though the FDA has granted such designation for NVX-CoV2373 and NanoFlu ™ , it

may not actually result in faster clinical development or regulatory review or approval.

Even though the FDA has granted such designation for NVX-CoV2373 and NanoFlu ™ , it may not actually result in faster clinical development or regulatory review or approval.

Furthermore, such a designation does not increase the likelihood that NVX-CoV2373 or NanoFlu™ will receive marketing approval in the U.S.

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Federal, state and local laws and regulations govern the use, manufacture, storage, handling and disposal of these materials.

We could be subject to civil damages in the event of an improper or unauthorized release of, or exposure of individuals to, these hazardous materials.

We could be subject to civil damages in the event of an improper or unauthorized release of, or exposure of

individuals to, these hazardous materials.

In addition, claimants may sue us for injury or contamination that results from our use or the use by third parties of these materials, and our liability may exceed our total assets.

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• the federal Anti-Kickback Statute, which prohibits, among other things, persons from knowingly and willfully soliciting, receiving or providing remuneration, directly or indirectly, to induce the referral for an item or service or the purchasing or ordering of a good or service, for which payment may be made under federal healthcare programs such as Medicare and Medicaid;

• federal false claims laws, including the FCA, which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, information or claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent;

• federal false claims laws, including the False Claims Act ("FCA"), which prohibit, among other things, individuals or entities from knowingly presenting, or causing to be presented, information or claims for payment from Medicare, Medicaid, or other third-party payers that are false or fraudulent;

• manufacturers can be held liable under the FCA even when they do not submit claims directly to government payors if they are deemed to “cause” the submission of false or fraudulent claims;

the FCA also permits a private individual

acting as whistleblower to bring actions on behalf of the federal government alleging violations of the FCA and to share in any monetary recovery;

the FCA also permits a private individual acting as whistleblower to bring actions on behalf of the federal government alleging violations of the FCA and to share in any monetary recovery;

• federal laws that require pharmaceutical manufacturers to report certain calculated product prices to the government or provide certain discounts or rebates to government authorities or private entities, often as a condition of reimbursement under government healthcare programs;

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Our success in large part depends on our ability to maintain the proprietary nature of our technology and other trade secrets.

To do so, we must prosecute and maintain existing patents, obtain new patents and pursue trade secret and other

intellectual property protection.

To do so, we must prosecute and maintain existing patents, obtain new patents and pursue trade secret and other intellectual property protection.

We also must operate without infringing the proprietary rights of third-parties or allowing third-parties to infringe our rights.

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Some of our know-how and technology is not patentable.

To protect our proprietary rights in unpatentable intellectual property and trade secrets, we require employees, consultants, advisors and collaborators to enter into confidentiality agreements.

To protect our proprietary rights in unpatentable intellectual property and trade secrets, we require employees, consultants, advisors and collaborators to enter into confidentiality

These agreements may not provide meaningful protection for our trade secrets, know-how or other proprietary information.

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Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our confidential information could be compromised by disclosure during this type of litigation.

In addition, during the course of litigation, there could be public announcements of the results of hearings, motions or

other interim proceedings or developments.

In addition, during the course of litigation, there could be public announcements of the results of hearings, motions or other interim proceedings or developments.

If investors perceive these results to be negative, the market price for our common stock could be significantly harmed.

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Such a license may not be available on commercially reasonable terms, or at all.

If we are unable to obtain a license, we may be required to expend time, effort, and other resources to design around the patent.

If we are unable to obtain a license, we may be required to expend time, effort, and

other resources to design around the patent.

Any such license may be non-exclusive and if a competitor is able to obtain a license from the third party, our ability to exclude that competitor from the market may be negatively impacted.

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obtain a license from the holder of the intellectual property right alleged to have been infringed, which license may not be available on reasonable terms, if at all;

and redesign our products

to avoid infringing the intellectual property rights of third-parties, which may be time-consuming or impossible to do.

and redesign our products to avoid infringing the intellectual property rights of third parties, which may be time-consuming or impossible to do.

In addition, changes in, or different interpretations of, patent laws in the U.S.

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Supporting our growth initiatives will require significant expenditures and management resources, including investments in research and development, manufacturing in-house and through third-party manufacturers and other areas of our business.

Furthermore, we are in process of implementing a new enterprise resource planning system, which is intended to increase efficiency, but may result in disruptions or delays to our operations during its implementation.

If we do not successfully manage our growth and do not successfully execute our growth initiatives, then our business and financial results may be adversely impacted, and we may incur asset impairment or restructuring charges.

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The secure maintenance of this information is critical to our operations and business strategy.

Some of this information could be an attractive target of criminal attack by malicious third parties with a wide range of motives and expertise, including nation-states, organized criminal groups, “hacktivists,” patient groups, disgruntled current or former employees and others.

Hacker attacks are of ever-increasing levels of sophistication, and despite our security measures, our information technology and infrastructure may be

vulnerable to such attacks or may be breached due to employee error or malfeasance.

Some of this information represents an attractive target of criminal attack by malicious third parties with a wide range of motives and expertise, including nation-states, organized criminal groups, “hacktivists,” patient groups, disgruntled current or former employees and others.

Our ongoing operating activities also depend on functioning computer systems.

Hacker attacks are of ever-increasing levels of sophistication, and, despite our security measures, our information technology and infrastructure are subject to such attacks or breaches.

In 2020, several domestic and foreign security agencies announced that government actors or government-affiliated actors were specifically targeting organizations engaging in COVID-19 vaccine development and research.

Our profile as an OWS recipient and progress on NVX-CoV2373 may result in greater risk of cyber-attack.

Any such breach could compromise our networks, our enterprise resource planning software and the information stored there could be accessed, publicly disclosed, lost or stolen.

Furthermore, if our systems become compromised, we may not promptly discover the intrusion.

Like other companies in our industry, we have experienced attacks to our data and systems, including malware and computer viruses.

Any such breach could result in a material compromise of our networks, our enterprise resource planning software and the information stored there could be accessed, publicly disclosed, lost, rendered, permanently or temporarily, inaccessible.

Furthermore, we may not promptly discover a system intrusion.

Like other companies in our industry, we have experienced attacks to our data and systems, including malware and computer viruses, and systems of others with connections to our systems, or with data relevant to our business, also have experienced attacks.

Attacks could have a material impact on our business, operations or financial results.

Any access, disclosure or other loss of information could result in legal claims or proceedings, liability under laws that protect the privacy of personal information, disrupt our operations, and damage our reputation, which could adversely affect our business.

In addition, privacy and data protection laws may be interpreted and applied differently from country to country and may create inconsistent or conflicting requirements, which can increase the costs incurred by us in complying with such laws.

We also may need to pay "ransomware" to re-access our systems.

In addition, privacy and data protection laws may be interpreted and applied differently from country to country and may create inconsistent or conflicting requirements, which increase the costs incurred by us in complying with such laws.

The European Union’s GDPR, which greatly increases the jurisdictional reach of European Union law and became effective in May 2018, adds a broad array of requirements for handling personal data including the public disclosure of significant data breaches, and imposes substantial penalties for non-compliance of up to the greater of €20 million or 4% of global annual revenue for the preceding financial year.

Our efforts to comply with GDPR and other privacy and data protection laws may impose significant costs and challenges that are likely to increase over time, and we could incur substantial penalties or litigation related to violations of existing or future data privacy laws and regulations.

Our efforts to comply with GDPR and other privacy and data protection laws impose significant costs and challenges that are likely to increase over time, and we are exposed to substantial penalties or litigation related to violations of existing or future data privacy laws and regulations.

The GDPR imposes strict rules on the transfer of personal data to countries outside the European Economic Area (“EEA”), including the United States and, in response, the EU and United States agreed in 2016 to a transfer framework for data transferred from the European Union to the United States, called the EU-US Privacy Shield.

On July 16, 2020, however, the Court of Justice of the European Union issued a decision that declared the Privacy Shield framework, one of the primary mechanisms U.S.

On July 16, 2020, however,

the Court of Justice of the European Union issued a decision that declared the Privacy Shield framework, one of the primary mechanisms U.S.

companies used to import personal information from Europe, invalid, and raised questions about whether the European Commission’s Standard Contractual Clauses (“SCCs”), an alternative to the Privacy Shield, can lawfully be used for cross-border data transfers.

On June 4, 2021, the European Commission adopted new SCCs under the GDPR for personal data transfers outside of the EEA.

Under this legal mechanism, we may have obligations to conduct transfer impact assessments for such cross-border data transfers and implement additional security measures.

On June 4, 2021, the European Commission adopted new SCCs under the GDPR for personal data transfers outside of the EEA Under this legal mechanism, we may have obligations to conduct transfer impact assessments for such cross-border data transfers and implement additional security measures.

As we incorporate the new SCCs into our contractual arrangements, we may be required to expend significant resources to update our contractual arrangements and to comply with such obligations.

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or requiring us to increase our data processing capabilities in Europe at significant expense.

Additionally, the CCPA, which became effective January 1, 2020, substantially expands privacy obligations of many businesses.

Additionally, the California Consumer Privacy Act ("CCPA"), which became effective January 1, 2020, substantially expands privacy obligations of many businesses.

The CCPA requires new disclosures to California consumers, imposes new rules for collecting or using information about minors, and affords consumers new abilities, such as the right to know whether the data is sold or disclosed and to whom, the right to request that a company delete personal information collected, the right to opt-out of the sale of personal information and the right to non-discrimination in terms of price or service when a consumer exercises a privacy right.

If we fail to comply with these regulations, we could be subject to civil sanctions, including fines and penalties for noncompliance.

Failure to comply with these regulations is subject to civil sanctions, including fines and penalties.

The CCPA provides for civil penalties for violations, as well as a private right of action for data breaches that is expected to increase data breach litigation.

Moreover, a newly passed ballot initiative, the California Privacy Rights Act (“CPRA”), which will become operational in 2023, expands on the CCPA, creating new consumer rights and protections, including the right to correct personal information, the right to opt out of the use of personal information in automated decision making, the right to opt out of “sharing” consumer’s personal information for cross-context behavioral advertising, and the right to restrict use of and disclosure of sensitive personal information, including geolocation data to third parties.

We will need to evaluate and potentially update our privacy program to ensure compliance with the CPRA and may incur additional costs and expenses in our effort to comply.

Collaborations and contracts of our wholly owned subsidiaries Novavax AB and Novavax CZ, with regional partners, such as SIIPL and Cadila, as well as with international providers, expose us to additional risks associated with doing business outside the U.S.

We will need to evaluate and potentially update our privacy program to seek to comply with the CPRA and will incur additional costs and expenses in our effort to comply.

In addition to California, Colorado and Virginia have also enacted comprehensive privacy laws but it is quite possible that other states will follow suit.

We anticipate that more states may enact legislation similar to the CCPA and the other recent consumer privacy laws.

Such proposed legislation, if enacted, may add additional complexity, variation in requirements, restrictions and potential legal risk, require additional investment of resources in compliance programs, impact strategies and the availability of previously useful data and could result in increased compliance costs and/or changes in business practices and policies.

The existence of comprehensive privacy laws in different states in the country will make our compliance obligations more complex and costly and may increase the likelihood that we may be subject to enforcement actions or otherwise incur liability for noncompliance.

Collaborations and contracts of our wholly owned subsidiaries Novavax AB and Novavax CZ, with regional partners, such as SIIPL, Takeda and SK bioscience, as well as with international providers, expose us to additional risks associated with doing business outside the U.S.

Swedish-based Novavax AB and Czech Republic-based Novavax CZ are wholly owned subsidiaries of Novavax, Inc.

We also have established a manufacturing and distribution agreement with SIIPL, formed a joint venture with Cadila in India and have entered into other agreements and arrangements with foreign governments and companies in other countries.

We also have entered into a supply and license agreement with SIIPL, collaboration and license agreements with each of Takeda and SK bioscience and other agreements and arrangements with foreign governments and companies in other countries.

We plan to continue to enter into collaborations or partnerships with companies, non-profit organizations and local governments in various parts of the world.

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Our failure to repurchase the Notes upon a fundamental change when required would result in an event of default with respect to the Notes which could, in turn, constitute a default under the terms of our other indebtedness, if any.

If the repayment of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the Notes.

If the repayment

of the related indebtedness were to be accelerated after any applicable notice or grace periods, we may not have sufficient funds to repay the indebtedness and repurchase the Notes.

Capped call transactions entered into in connection with our Notes may affect the value of our common stock.

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Our stock price has been highly volatile.

From January 1, 2021 through July 31, 2021, the closing sale price of our common stock has been as low as $112.98 per share and as high as $319.93 per share.

From January 1, 2021 through October 31, 2021, the closing sale price of our common stock has been as low as $112.98 per share and as high as $319.93 per share.

The stock market in general and the market for biotechnology companies in particular have experienced extreme volatility that has often been unrelated to the operating performance of particular companies.

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For example, our organizational documents provide for a staggered board with three classes of directors serving staggered three-year terms and advance notice requirements for stockholders to nominate directors and make proposals.

stock for a period of three years from the date such person acquired such common stock, unless advance board or stockholder approval was obtained.

As a Delaware corporation, we are also afforded the protections of Section 203 of the Delaware General Corporation Law, which will prevent us from engaging in a business combination with a person who acquires at least 15% of our common stock for a period of three years from the date such person acquired such common stock, unless advance board or stockholder approval was obtained.

Any delay or prevention of a change of control transaction or changes in our Board or management could deter potential acquirers or prevent the completion of a transaction in which our stockholders could receive a substantial premium over the then current market price for their shares.

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General Risk Factors

Litigation could have a material adverse impact on our results of operation and financial condition.

In addition to intellectual property litigation, from time to time, we may be subject to other litigation.

Regardless of the merits of any claims that may be brought against us, litigation could result in a diversion of management’s attention and resources and we may be required to incur significant expenses defending against these claims.

If we are unable to prevail in litigation, we could incur substantial liabilities.

Litigation or regulatory investigations could have a material adverse impact on our results of operation and financial condition.

In addition to intellectual property litigation, from time to time, we may be subject to other litigation or regulatory investigations.

Regardless of the merits of any claims that may be brought against us, litigation or regulatory investigations could result in a diversion of management’s attention and resources and we may be required to incur significant expenses defending against these claims.

If we are unable to prevail in litigation or regulatory investigations, we could incur substantial liabilities.

Where we can make a reasonable estimate of the liability relating to pending litigation and determine that it is probable, we record a related liability.

16 unchanged sentences

Our clinical trials, whether planned or ongoing, may be affected by the COVID-19 pandemic.

Study procedures (particularly any procedures that may be deemed non-essential), site initiation, participant recruitment and enrollment, participant dosing, shipment of our product candidates, distribution of clinical trial materials, study monitoring, site inspections and data analysis may be paused or delayed due to changes in hospital or research institution policies, federal, state or local

regulations, prioritization of hospital and other medical resources toward efforts to treat or prevent COVID-19, or other reasons related to the pandemic.

In addition, there could be a potential effect of COVID-19 to the operations of the FDA or other health authorities, which could result in delays of reviews and approvals, including with respect to our product candidates.

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When such events occur, there is a risk that we fail to monitor and comply with applicable adverse event reporting obligations or we may not be able to defend our business or the public’s legitimate interests in the face of the political and market pressures generated by social media due to restrictions on what we may say about our investigational product candidates.

There is also a risk of inappropriate disclosure of sensitive information or negative or inaccurate posts or comments about us on any social media or networking website.

There is also a risk of inappropriate disclosure of sensitive information or negative or

inaccurate posts or comments about us on any social media or networking website.

If any of these events were to occur or we otherwise fail to comply with applicable regulations, we could incur liability, face regulatory actions, or incur reputational or other harm to our business.

1 unchanged sentence

3.2 Certificate of Amendment to the Second Amended and Restated Certificate of Incorporation of the Registrant (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 9, 2019 (File No.

3.3 Amended and Restated By-Laws of the Registrant (Incorporated by reference to Exhibit 3.

1 to the Registrant’s Current Report on Form 8 -K filed on June 24 , 20 21 (File No.

3.3 Amended and Restated By-Laws of the Registrant (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on June 24, 2021 (File No.

3.4 Certificate of Designation of Series A Convertible Preferred Stock of the Registrant (Incorporated by reference to Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed June 19, 2020 (File No.

10.1* Employment Agreement, dated April 12, 2021, between Novavax, Inc.

10.1* Employment Agreement, dated July 12, 2021, between Novavax, Inc.

10.2* Offer letter to James P.

Kelly dated July 12, 2021

10.3* Consulting Agreement, dated August 10, 2021, between Novavax, Inc.

and Gregory F.

10.2* Form of Amendment to Employment Agreement, dated June 17, 2021, between Novavax, Inc.

and each of Stanley C.

Erck, Gregory M.

Glenn, John J.

Trizzino and John A.

Herrmann, III

10.3 Amended and Restated Novavax, Inc.

2015 Stock Incentive Plan (Incorporated by reference to Appendix A of the Registrant’s Definitive Proxy Statement filed on May 3, 2021 in connection with the Annual Meeting held on June 17, 2021 (File No.

10.4* Novavax, Inc.

Amended and Restated Change in Control Severance Benefit Plan

10.5*± Advance Purchase Agreement, dated May 5, 2021, between Novavax, Inc.

and the Gavi Alliance

10.4*± Amended and Restated Supply and License Agreement, dated July 1, 2021, between Novavax, Inc.

and Serum Institute of India Private Limited

10.5*± Modification No.

09 to Undefinitized Project Agreement No.

1, dated April 23, 2021, between Novavax, Inc.

1, dated July 16, 2021, between Novavax, Inc.

and Advanced Technology International

1 unchanged sentence

10 to Undefinitized Project Agreement No.

1, dated June 4, 2021, between Novavax, Inc.

1, dated August 6, 2021, between Novavax, Inc.

and Advanced Technology International

10.7*± Modification No.

11 to Undefinitized Project Agreement No.

1, dated August 26, 2021, between Novavax, Inc.

and Advanced Technology International

10.8*± Advance Purchase Agreement, dated August 16, 2021, between Novavax, Inc., Novavax CZ and the European Commission

31.1* Certification of Chief Executive Officer pursuant to Rule 13a-14(a) or 15d-14(e) of the Securities Exchange Act

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Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101 The following financial information from our Quarterly Report on Form 10-Q for the quarter ended June 30, 2021, formatted in Inline Extensible Business Reporting Language (Inline XBRL):

(i) the Consolidated Balance Sheets as of June 30, 2021 and December 31, 2020, (ii) the Consolidated Statements of Operations for the three- and six-month periods ended June 30, 2021 and 2020, (iii) the Consolidated Statements of Comprehensive Loss for the three- and six-month periods ended June 30, 2021 and 2020, (iv) the Consolidated Statements of Changes in Stockholders’ Equity (Deficit) for the three- and six-month periods ended June 30, 2021 and 2020, (v) the Consolidated Statements of Cash Flows for the six-month period ended June 30, 2021 and 2020, and (vi) the Notes to Consolidated Financial Statements.

101 The following financial information from our Quarterly Report on Form 10-Q for the quarter ended September 30, 2021, formatted in Inline Extensible Business Reporting Language (Inline XBRL):

(i) the Consolidated Balance Sheets as of September 30, 2021 and December 31, 2020, (ii) the Consolidated Statements of Operations for the three- and nine-month periods ended September 30, 2021 and 2020, (iii) the Consolidated Statements of Comprehensive Loss for the three- and nine-month periods ended September 30, 2021 and 2020, (iv) the Consolidated Statements of Changes in Stockholders’ Equity for the three- and nine-month periods ended September 30, 2021 and 2020, (v) the Consolidated Statements of Cash Flows for the nine-month period ended September 30, 2021 and 2020, and (vi) the Notes to Consolidated Financial Statements.

104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101).

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NOVAVAX, INC.

August 5, 2021 By:

November 4, 2021 By:

/s/ Stanley C.

1 unchanged sentence

(Principal Executive Officer)

August 5, 2021 By:

Executive Vice President, Chief Commercial Officer, Chief Business Officer and Interim Chief Financial Officer

November 4, 2021 By:

Executive Vice President, Chief Financial Officer and Treasurer

(Principal Financial and Accounting Officer)

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1A. Risk Factors