By Benjamin Horney

Law360 (June 15, 2020, 3:12 PM EDT) -- Health care and life sciences-focused investment manager RA Capital Management has agreed to provide Ropes & Gray LLP-advised Novavax Inc. with $200 million to help in its efforts to develop and mass produce a potential vaccine for COVID-19, the companies said Monday.

The private investment in public equity, or PIPE, deal will see a fund affiliated with RA Capital buy $200 million worth of Series A convertible preferred stock of Gaithersburg, Maryland-based Novavax, according to a statement. The stock will be convertible into more than 4.3 million shares of Novavax common stock, and the RA Capital affiliate has agreed to a price that is equivalent to $45.47 per share, which was the closing price of Novavax stock Friday.

Stanley C. Erck, president and CEO of Novavax, said in the news release, "We are extremely pleased to receive this tremendous support from RA Capital, which we believe signals a high level of confidence in the significant progress of our COVID-19 and influenza vaccine programs." 

The transaction represents just the latest in a series of moves made by Novavax in recent months as the company attempts to be one of the coronavirus vaccine pioneers. 

Roughly two weeks ago, the company was awarded a contract by the U.S. Department of Defense to manufacture its in-development COVID-19 vaccine candidate, NVC-CoV2373, according to a statement from June 4.

Before that, in late May, Novavax agreed to buy Czech Republic-based Praha Vaccines for $167 million. The duo is working with vaccine-manufacturer Serum Institute of India to develop and mass produce the potential vaccine for COVID-19. 

The deal with Praha Vaccines came during the same week that Novavax announced enrollment of the first participants in a clinical trial for its coronavirus vaccine candidate. Preliminary results from Phase 1 of the trial are expected this July, according to Novavax.

Earlier in May, Novavax revealed that the Coalition for Epidemic Preparedness Innovations had agreed to contribute as much as $384 million in additional funding to advance the company's research on the vaccine candidate. That investment came on top of $4 million that CEPI provided to Novavax in March.

"The global vaccine effort is searching for candidates that are capable of both generating the highest neutralizing antibody titers and large-scale production," Peter Kolchinsky, managing partner at RA Capital, said in Monday's news release. "We are excited to increase our investment in Novavax, which along with resources from CEPI and the U.S. Department of Defense, will support Novavax in its important work developing an effective, scalable vaccine for SARS-CoV-2."

PIPE deals have become a hot commodity in the age of the coronavirus, with many companies tapping into the PIPE market to raise capital during a time of intense economic difficulty. Just last week, Canadian private equity firm Onex Corp. agreed to plug $400 million into live event operator Emerald Holding Inc. in a PIPE deal meant to fortify Emerald's financial position in light of the coronavirus. Although their popularity may wane once the pandemic is truly in the rearview mirror, experts say PIPE deals will always exist as a potentially attractive transaction type for clients seeking increased liquidity.

The Ropes & Gray LLP team advising Novavax on Monday's PIPE deal included securities and public companies partner Paul Kinsella and associates Benjamin Kozik and Katherine Fisher; private equity associate Kara Bischak; and corporate associates Alyssa Marchetti and Patrick Messenger.

Other counsel information was not immediately available Monday.

--Editing by Kelly Duncan.

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