Valneva stock rocketed Tuesday on a $95 million investment from Pfizer, its Lyme disease vaccine partner.
The hefty investment snags Pfizer an 8.1% stake in Valneva, a Paris-based vaccines maker. The two companies inked a deal in April under which Pfizer will run final-phase testing for Valneva's Lyme disease shot. Pfizer's study is expected to begin in the third quarter.
"Pfizer's investment in Valneva highlights the quality of the work that we've done together over the past two years and is a strong recognition of Valneva's vaccine expertise," Valneva Chief Executive Thomas Lingelbach said in a written statement.
On the stock market today, Valneva stock soared 93.1% to 26.48. Pfizer stock rose 3.4% to 48.11.
Valneva Stock: Adding Onto 2020 Agreement
The investment will close Wednesday and will help support the companies' Lyme disease work.
Lyme disease is spread by ticks and is dominant in North America and Europe. It leads to rash, fever, headache and/or fatigue. Kathrin Jansen, who heads up vaccine research and development at Pfizer, estimates there are 600,000 cases annually across the two regions.
"As the geographic footprint of Lyme disease widens, the medical need for vaccination becomes even more imperative," she said in a written statement. "We are excited to continue partnering with Valneva on the development of (the vaccine called) VLA15."
Further, the companies updated the terms of a collaboration agreement announced in April 2020 before Valneva stock went public.
Valneva now plans to fund 40% of the remaining shared development costs, compared with 30% in the original agreement. And Pfizer will pay tiered royalties ranging from 14%-22%, compared with the originally agreed-upon 19%.
In addition, Valneva could also receive up to $100 million in sales-based milestones, on top of $168 million remaining in commercial and development milestones.
The news Tuesday helped Valneva stock narrowly retake its 50-day moving average, according to MarketSmith.com.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
