(Reuters) – Valneva lost nearly a fifth of its value on Monday after the French drugmaker said its COVID-19 vaccine agreement with the European Commission was likely to be scrapped and it might have to rethink its financial guidance.
Valneva said the European Commission (EC) had informed the company of its intent to terminate an advance purchase agreement for its COVID vaccine, Europe’s only candidate vaccine based on whole, inactivated virus.
A final decision on the deal has still not been made, a Commission spokesperson said on Monday.
Valneva’s shares were down about 19.5% at 1455 GMT.
“The EC decision is regrettable especially as we continue to receive messages from Europeans who are looking for a more traditional vaccine solution,” CEO Thomas Lingelbach said.
Valneva signed a deal with the EC last November to supply up to 60 million doses of vaccine over two years, including 24.3 million doses in 2022.
The company has already received roughly 30% in pre-payments from the EC under the contract, CEO Lingelbach said, noting that if the deal is cancelled Valneva is not required to return them.
The supply deal gave the EC the right to cancel if the vaccine was not endorsed by the European Medicines Agency (EMA) by the end of April. It still has not got an EMA green light, but Lingelbach said he remained confident that it will by June.
Under the deal, Valneva has 30 days from May 13 to win marketing authorisation or propose an acceptable remediation plan.
Valneva is working with the EC on a remediation plan and intends to make the vaccine available to those EU member states that still want it.
Certain member states, including “very big European countries” have already expressed interest, Lingelbach said.
Britain cancelled its Valneva COVID-19 vaccine supply deal in 2021.
Valneva scored its first approval in Bahrain and has since begun to deploy its vaccine there. On Monday, the company also secured emergency approval in the United Arab Emirates.
Valneva expects to report data on the use of its COVID vaccine as a booster in the third quarter.
($1 = 0.9586 euros)
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