Valneva Plunges After Europe Slashes Covid Vaccine Order

Tim Loh, Bloomberg News

A sign stands outside the Valneva SA laboratories in Vienna, Austria, on Thursday, Aug. 6, 2020. The U.K. has signed agreements to buy 90 million doses of vaccines in development by drugmakers including Pfizer Inc., BioNTech SE and Valneva SE, joining countries around the world racing to secure supplies of protection against Covid-19. Photographer: Akos Stiller/Bloomberg , Bloomberg

(Bloomberg) -- Valneva SE fell as much as 15% after the European Union slashed its order of the French company’s Covid-19 vaccine.

European countries will now buy 1.25 million doses of Valneva’s vaccine after amending a previous purchasing agreement that called for 27 million doses in 2022 and as many as 60 million over two years.

The French drugmaker first warned in May that its supply deal with the EU may get scrapped, throwing this year’s financial outlook into doubt. It’s now evaluating the future of its Covid-19 program and will invest in development if it finds other potential customers.

“We feel the order volume does not reflect the interest we see from European citizens,” Chief Executive Officer Thomas Lingelbach said in a statement. “Despite this, we have decided to enter into this amendment. While the pandemic had been declining, the latest Covid-19 wave in Europe clearly underlines the need for alternative vaccines.”

The Valneva shot uses an inactivated version of the SARS-CoV-2 virus to stimulate an immune response -- an approach widely used in the production of flu and polio inoculations. The more traditional approach could help persuade vaccine holdouts to receive their shots, the company has argued.