Vaxart’s high short interest made it a focus of the past mon But Vaxart said that two doses of its vaccine failed to induce neutralizing antibodies to the Covid virus. In the clinical trials of other vaccines, antibody levels correlated with protection against Covid symptoms.
In 15 years of operations, Vaxart has reported no product revenue and had run up a cumulative deficit of $135 million through September 2020. Hopes for its oral vaccine programs against Covid and influenza allowed it to raise capital, and it still had $133 million in cash on its September balance sheet.
But skepticism about the company’s prospects led to its stock becoming one of the most highly-shorted small-cap securities, as investors made short-sale bets that it would drop. Vaxart’s securities filings acknowledged that it is under investigation by the Securities and Exchange Commission and the Justice Department for having said in June that its product had been selected by the U.S. government’s Operation Warp Speed vaccine-development program.
Vaxart’s high short interest made it a focus of the past month’s short-squeeze campaign, in which traders were rallied on social media platforms like Reddit to push up highly-shorted stocks and force short sellers to lift the prices further as they bought shares to close out their losing bets.
From late December, Vaxart shares rose fourfold to a Tuesday peak just below $25, which valued the little start-up at more than $2.5 billion. After Wednesday’s disappointment, Vaxart has a market capitalization of $1.3 billion.