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Shah Capital, which currently owns a near 7.5% stake in Novavax and is its third-largest shareholder, reiterated that the company was “undervalued and continues to suffer from poor profitability”.
Novavax last year had raised doubts about its ability to remain in business, hurt by manufacturing snags and regulatory hurdles that delayed the entry of its protein-based vaccine to the market.
Last month, the top shareholder expressed concerns over mismanagement at the Maryland-based biotech and nominated two of its own candidates for the board. It had also urged Novavax to adopt a marketing strategy to target consumers who are hesitant to receive mRNA vaccines.
The hedge fund said in a regulatory filing on Monday that it plans to vote against directors Richard Douglas, Margaret McGlynn and David Mott at Novavax’s shareholder meeting in June.
“We believe that fresh perspectives are desperately needed in the boardroom to steer Novavax towards sustainable profitable growth,” it said in a statement.
McGlynn and Mott have served on Novavax’s board since 2020 and Douglas since 2010.
Novavax said it welcomes the perspectives of its shareholders and values their input.
“We believe we have the right board in place to oversee Novavax’s strategy,” the company said in its response.
Shares of the biotech fell 1.6% to $4.85 in early trading.
In April, Shah Capital nominated Suresh Katta, founder and CEO of biotech firm Saama, and Venkat Peri, CEO of Quantiva Health, to Novavax’s eight-member board, saying the duo had the experience required to set the company’s strategic direction.
Shah Capital also plans to vote against three other proposals, including one related to the compensation of some of Novavax’s executives.
