Novavax Inc announced that the National Institute of Allergy and Infectious Diseases (NIAID), a component of the National Institutes of Health (NIH), has cancelled its five-year contract for the development of human immunodeficiency virus (HIV) vaccine candidates due to programmatic considerations for "the government's convenience." Novavax had been the prime contractor, with Emory University, Tulane University, and the University of Pittsburgh as subcontractors, a company release said.

This event is not expected to have a material financial impact on Novavax. The Company expects to recover costs incurred to date in association with this contract. Novavax has a second HIV vaccine programme funded by the NIH through a consortium led by the University of Alabama at Birmingham and including Emory University and Harvard University. This second NIH-funded HIV vaccine programme is not impacted by this event, the release says.

Dr. Gale E Smith, vice president, Vaccine Development commented, "Our HIV vaccine development programme will now focus on the contract with the University of Alabama. HIV vaccine candidates based on Novavax's virus-like particle (VLP) platform technology continue to offer significant opportunities for the prevention of AIDS. We have made considerable progress in developing a commercial process to manufacture VLP vaccines. The first candidate HIV vaccine will be delivered to the University of Alabama for animal testing within the next several months."

"The consolidation of our HIV efforts allows Novavax's scientific team to focus on other promising applications of our proprietary VLP vaccine technology and to strengthen efforts on building a vaccine business for emerging threats to human health and safety," added Dr. Smith.