This DVAX Stock Forecast article was written by Hugh Camiener, Analyst at I Know First. Bachelor of Arts candidate at Columbia University.

Summary 

• Dynavax (DVAX), is a commercial state biopharmaceutical company which develops and commercializes vaccines.
• Dynavax has an FDA approval on their Hepatitis B vaccine, and they have partnered with Sinovac in developing a vaccine for COVID. 
• The pandemic has caused a significant decline in Dynavax’s revenue, with their net product revenue falling 71% in comparison to Q2 last year. 
• Dynavax’s vaccine partnership with Sinovac has shown positive signs in phase 1 and phase 2 of testing, and their vaccine will be entering phase 3 in Brazil.
• There is a large amount of volatility in the biopharmaceutical industry; amidst Russia’s self-proclaimed vaccine, Dynavax’s stock fell 9.7%.
•    DVAX stock forecast remains a high-risk, high reward option.

What Is Dynavax?

Dynavax is a commercial state biopharmaceutical company which develops and commercializes vaccines. The company both discovers and develops  their biopharmaceutical products. Dynavax focuses on the power of the body’s immune system, utilizing toll-like receptors to stimulate immune responses. Their technology plays a prominent role in innate immunity to diseases and subsequent adaptive immunity. Dynavax is based out of Emeryville, California and is a component of the Russell 2000, one of the leading small-cap indices. Dynavax currently has an FDA approval on their Hepatitis B vaccine, and is teaming up with Sinovac on a vaccine for the coronavirus. This article will be discussing I Know First’s DVAX Stock Forecast.   

DVAX Hepatitis B Vaccine 

Hepatitis B is a disease of the liver which can become chronic and lead to cancer and death. Hepatitis B is significantly more infectious than HIV, around 50 to 100 times. And while there is no cure for Hepatitis B, vaccination can prevent the disease. HEP B is spread through contact with infected blood and unprotected sex. The Center for Disease Control recommends vaccination for those at high risk. Hepatitis B vaccinations are also extremely important to those with diabetes, as they are more susceptible to infectious diseases. The CDC recommends that anyone with diabetes be vaccinated as soon as possible after their diagnosis. As the US has around 20 million people with diabetes, 1.5 million new every year, and even more engaging in sexual activity, Dynavax’s worldwide commercial rights to HEPLISAV-B, their vaccine, is significant. 

Dynavax’s Product Revenue 

Dynavax’s HEP B vaccine is currently their only on the market. In the second quarter of 2020, their net product revenue fell to $2.4 million, in comparison to $8.3 million from the previous year. CEO Ryan Spencer commented on the company’s quarter 2 performance: As expected from the pandemic driven disruption to non-COVID medical care, the adult hepatitis B vaccine market experienced a significant decline early in the second quarter.  Despite the short-term impact, we continue to be optimistic about HEPLISAV-B’s long-term value, particularly with the global focus on vaccination efforts as a result of the pandemic.” 

Even with expected revenue losses due to the coronavirus, DVAX stock has risen significantly in its stock value. Hepatitis B Vaccines have started to be administered to near normal levels again, reaching 60% of pre-covid levels in July. Dynavax has also become a player in using their technologies to develop a coronavirus vaccine. Dynavax has currently teamed up with the Coalition for Epidemic Preparedness Innovations, Clover Pharmaceuticals, and Sinovac. 

DVAX Stock Forecast: Reliant On Biopharmaceutical Partnerships

Reports of Dynavax’s partnership with Sinovac have been mostly positive. Sinovac’s vaccine candidate, the CoronaVac, enacted neutralizing antibodies 14 days after vaccination. This result occurred over 90% of the time in both phase 1 and phase 2 studies. At this time, the scientific community does not know how many antibodies can protect people from COVID, if at all. Coronovac will be moving towards phase 3 trials in Brazil, where thousands of people will be tested. Right now within the scientific community there is a divide on the best method to create a vaccine. Sinovac uses the inactivated virus to stimulate an immune response, proven to be effective with polio and influenza. However, other companies are attempting to use next-generation platforms that use the DNA and RNA to form a vaccine. Right now, there seems to be a lot of players on the table, and there is no indication of when or who will create the best vaccine.    

DVAX Stock Plumbits Amidst News of a Russian Vaccine 

There is also an incredible amount of volatility stemming from news of certain coronavirus vaccines. In fact, Russia “approved” the world’s first coronavirus vaccine, Sputnik-V. Putin claims that the vaccine is effective and that it forms stable immunity to the virus. However, even though Putin claims his own daughter took the vaccine, his claims are questionable at best. The vaccine did not undergo the extreme clinical testing in order to suffice such a statement. CNN has also reported that Russia did not release any information backing their claim. The unexpected news did significantly affect the market though, bringing down Dynavax’s stock by 9.7% and others as high as 21%. Nonetheless, even with short term volatility, our algorithm does indicate long term potential.

DVAX Stock Forecast: Conclusion

Dynavax remains a high risk, high reward option for investors. I would recommend waiting for more insight into phase 3 of Sinovac’s vaccine trials in Brazil before investing. Currently, there are so many players in the biopharmaceutical industry and only a few companies will hit big on a coronavirus vaccine. Right now, the biopharmaceutical market has high volatility surrounding potential news, and there is no clear indication of a frontrunner. There is certainly optimism surrounding Dynavax, as they already have an FDA approved drug on the market. However, with discouraging Q2 revenue from their Hepatitis B vaccine and no end to the pandemic in sight, Dynavax’s value stems from optimism surrounding a potential vaccine. For those who already own the stock, I recommend holding. And for those considering buying, I would recommend waiting for more information on Sinovac’s phase 3 trials. Our algorithm seems to mimic my prediction. Amidst news and volatility Dynavax is a recommended short in shortened time horizons, but it is also a worthy, high-risk long term play.

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