NOVAVAX INC, S-3, 1999-05-03

NOVAVAX INC
S-3, 1999-05-03
BIOLOGICAL PRODUCTS, (NO DIAGNOSTIC SUBSTANCES)

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<PAGE> 1

AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON MAY 3, 1999

REGISTRATION NO. __________

================================================================================

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

NOVAVAX, INC.
(Exact name of registrant as specified in its charter)

DELAWARE 22-2816046
(State of incorporation) (I.R.S. Employer Identification Number)

8320 GUILFORD ROAD
COLUMBIA, MD 21046
(301) 854-3900
(Address, including zip code, and telephone number,
of registrant's principal executive offices)

MITCHELL J. KELLY
NOVAVAX, INC.
8320 GUILFORD ROAD
COLUMBIA, MD 21046
(301) 854-3900
(Name, address, including zip code, and telephone number,
of agent for service of process)

With a copy to:
DAVID A. WHITE, ESQ.
WHITE & MCDERMOTT, P.C.
65 WILLIAM STREET
WELLESLEY, MA 02481
(781) 431-1700

Approximate date of commencement of proposed sale to the public: As soon
as practicable and from time to time after the effective date of this
Registration Statement.

If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]

If any of the securities being registered on this Form are to be offered
on a delayed or continuous basis pursuant to Rule 415 under the Securities Act
of 1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]

If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]

If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]

<PAGE> 2

<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
========================================================================================
Proposed Proposed
Maximum Maximum Amount of
Title of Securities Amount to Offering Aggregate Registration
to be Registered be Registered Per Share Offering Fee
- ----------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock 2,260,541 shares(1) $3.6875(2) $8,335,744.90 $2,317.34
($.01 par value)
========================================================================================
</TABLE>

(1) The shares being registered by this registration statement include (i)
1,651,100 shares of common stock sold by the Company in April, 1999 to various
purchasers in a private placement under the terms of a Stock and Warrant
Purchase Agreement dated April 14, 1999, (ii) 412,775 shares of common stock
that may be issued by the Company under warrants issued to the purchasers in the
private placement, (iii) an aggregate of 42,933 shares issued to two placement
agents in connection with the private placement, (iv) 153,733 shares of common
stock that may be issued by the Company under warrants issued to the placement
agents in connection with the private placement, and (v) pursuant to Rule 416 of
the Securities Act, an indeterminate number of additional shares that may be
issued under the terms of the above mentioned warrants as a result of
anti-dilution provisions, stock splits, stock dividends or similar transactions.

(2) Estimated solely for the purpose of determining the registration fee and
computed pursuant to Rule 457(c), based upon the average of the high and low
sale prices on April 26, 1999, as reported by the American Stock Exchange.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES
AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE
A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT
SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE
SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.

<PAGE> 3

PROSPECTUS

SUBJECT TO COMPLETION, DATED MAY 3, 1999

The information contained in this prospectus is not complete and may be changed.
The selling stockholders may not sell these securities until the registration
statement filed with the Securities and Exchange Commission is effective. This
prospectus is not an offer to sell these securities and it is not soliciting an
offer to buy these securities in any state where the offer or sale is not
permitted.

================================================================================
NOVAVAX, INC.
2,260,541 SHARES OF COMMON STOCK ($.01 PAR VALUE)
MAY __, 1999
================================================================================

Novavax is registering the sale of 2,260,541 shares of common stock
that may be sold from time to time by the selling stockholders identified in
the "Selling Stockholders" section of this prospectus. As permitted by Rule 416
of the Securities Act, this prospectus and the registration statement of which
it is a part also cover the offer and sale of an indeterminate number of
additional shares that may be issued to the selling stockholders under the
terms of certain warrants as a result of anti-dilution provisions, stock
splits, stock dividends or similar transactions.

The selling stockholders consist of the purchasers and the placement
agents who acquired warrants and shares of Novavax common stock in connection
with a private placement under the terms of a Stock and Warrant Purchase
Agreement between the Company and those purchasers dated April 14, 1999 as
further described in the "Recent Developments" section of this prospectus.

The Shares may be offered and sold by the selling stockholders from time
to time in open market or privately negotiated transactions in any manner
described in the "Plan of Distribution" section of this prospectus. Novavax will
not receive any of the proceeds from the sale of the shares by the selling
stockholders. The Company has agreed to pay certain expenses (other than selling
commissions) in connection with the registration and sale of the shares being
offered by the selling stockholders, estimated at $33,500. The Company has also
agreed to indemnify the selling stockholders against certain liabilities,
including certain liabilities under the Securities Act.

The Company's common stock is listed for quotation on the American Stock
Exchange under the symbol NOX. On April 26, 1999, the closing sale price of the
common stock, as reported by the American Stock Exchange, was $3.625 per share.

INVESTING IN NOVAVAX COMMON STOCK INVOLVES A HIGH DEGREE OF RISK. SEE
"RISK FACTORS" BEGINNING ON PAGE 4 OF THIS PROSPECTUS.

NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED THESE
SECURITIES OR DETERMINED THAT THIS PROSPECTUS IS ACCURATE OR COMPLETE.
IT IS ILLEGAL FOR ANYONE TO TELL YOU OTHERWISE.

<PAGE> 4

AVAILABLE INFORMATION

We are a public company and file annual, quarterly and special reports,
proxy statements and other information with the Securities and Exchange
Commission. You may read and copy any document we file at the SEC's public
reference room at 450 Fifth Street, N.W., Washington, D.C. 20549. You can
request copies of these documents by writing to the SEC and paying a copying
fee. Please call the SEC at 1-800-SEC-0330 for more information about the public
reference room operations. Our SEC filings are also available at the SEC's web
site at "http://www.sec.gov." In addition, you can read and copy our SEC filings
at the office of the National Association of Securities Dealers, Inc. at 1735 K
Street, Washington, DC, 20006.

Our Common Stock is listed on the American Stock Exchange. Reports,
proxy and information statements and other information concerning Novavax can be
examined at the American Stock Exchange Inc., 86 Trinity Place, New York, New
York 10006.

This prospectus is only part of a Registration Statement on Form S-3
that we have filed with the SEC under the Securities Act of 1933 and therefore
omits certain information contained in the Registration Statement. We have also
filed exhibits and schedules with the Registration Statement that are excluded
from this prospectus, and you should refer to the applicable exhibit or schedule
for a complete description of any statement referring to any contract or other
document. You may inspect a copy of the Registration Statement, including the
exhibits and schedules, without charge at the public reference room or obtain a
copy from the SEC upon payment of the fees prescribed by the SEC.

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

The SEC allows us to "incorporate by reference" the information we file
with it, which means that we can disclose important information to you by
referring you to those documents. This prospectus is part of a Registration
Statement we filed with the SEC. You should rely on the information incorporated
by reference in this prospectus and the Registration Statement. The information
incorporated by reference is considered to be part of this prospectus and
information we file later with the SEC will automatically update and supersede
this information. We incorporate by reference the documents listed below and any
future filings made with the SEC under Sections 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934 until the selling stockholders sell all of their
shares of common stock. The documents we are incorporating by reference are:

1. Novavax's Annual Report on Form 10-K for the fiscal year ended
December 31, 1998;

2. Novavax's definitive Proxy Statement dated April 23, 1999 relating
to the Annual Meeting of Stockholders to be held on June 8, 1999;
and

3. The description of the Common Stock contained in Novavax's
Registration Statement on Form 10, File No. 0-26770, filed on
September 14, 1995 pursuant to Section 12(b) of the Exchange Act.

You may request a copy of these filings at no cost by writing or
telephoning our chief financial officer at the following address and number:
Novavax, Inc., 8320 Guilford Road, Columbia, MD 21046; (301) 854-3900.

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

We also caution you that this prospectus contains forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. These statements are based
on management's beliefs and assumptions and on information currently available
to management and use words such as "expect," "anticipate," "intend," "plan,"
"believe," "estimate," or similar expressions. Forward-looking statements
include information concerning possible or assumed future results of operations,
future product development and related clinical trials and statements regarding
future research and development. Forward-looking statements necessarily involve
risks and uncertainties and other factors which may cause the actual results,
performance or achievements of Novavax, or industry results, to be materially
different from those anticipated in the forward-looking statements. These risks
and uncertainties are discussed in the Risk Factors section and elsewhere in
this prospectus.

THE COMPANY

Novavax, Inc. is a biopharmaceutical company focused on the research and
development of proprietary topical and oral drug delivery and encapsulation
technologies and the applications of those technologies. Our technology
platforms involve the use of proprietary, microscopic, organized,
non-phospholipid structures as vehicles for the delivery of a wide variety of
drugs and other therapeutic products, including certain hormones, anti-bacterial
and anti-viral products and vaccine adjuvants. These technology platforms
support three product development programs: hormone replacement therapies, third
party drug delivery and vaccine adjuvant applications and anti-microbial agents.

Hormone Replacement Therapies. Novavax's hormone replacement therapy
program includes its two lead product candidates: ESTRASORB(TM), a topical
estrogen cream, and ANDROSORB(TM), a topical testosterone cream. We have
completed various pre-clinical and human safety studies for both ESTRASORB and
ANDROSORB. In addition, we have completed dosing in a Phase II, randomized,
double-blind, placebo-controlled, dose-ranging ESTRASORB study in January, 1999.
A Phase I, multiple dose, pharmacokinetic ANDROSORB study that began in the
third quarter of 1998 is currently underway.

Third Party Drug Delivery and Vaccine Adjuvant Applications.
Formulations of our lipid technologies are expected to have broad application as
vehicles for the encapsulation and delivery of drugs developed by other
companies. Moreover, we believe that certain of our organized lipid structures
may provide effective and safe adjuvant carrier systems for a variety of
vaccines. We plan to leverage these technologies by licensing our drug delivery,
encapsulation and adjuvant technologies to third parties for specific
therapeutic indications.

Novavax currently has several research contracts in place to provide
anti-microbial products, vaccine products, services and adjuvant technologies.
One of these contracts is for the development of an adjuvant for an
immunotherapeutic vaccine for cervical dysplasia, a precancerous disease of the
cervix for a British vaccine company, Cantab Pharmaceuticals.

Anti-Microbial Agents. Novavax is also applying its lipid technologies
to develop anti-microbial agents that are capable of acting on viruses,
bacteria, spores and sperm. Potential product candidates include Helicore(TM),
an oral anti-bacterial preparation for the treatment of Helicobacter pylori ("H.
pylori") infection, and two anti-microbial agents targeting Bacillus anthracis
and influenza A, respectively, as well as two spermicide product candidates.
Pre-clinical and clinical studies for these product candidates are summarized
below:

o Novavax has completed several pre-clinical and Phase I safety studies
with a number of formulations of Helicore.

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o Novavax currently has several anti-microbial agents in pre-clinical
studies pursuant to a research collaboration with the University of
Michigan. The studies are being performed at the University of Michigan
and are being funded by Defense Advanced Research Projects Agency's
("DARPA") Unconventional Pathogen Countermeasures Program. Novavax is a
subcontractor to the University of Michigan.

o Novavax currently has two spermicide product candidates that are both
expected to be part of clinical studies sponsored by the National
Institutes of Health. The first of the product candidates is expected to
enter Phase I clinical trials in the second quarter of 1999.

Novavax was incorporated in Delaware in 1987. Our principal executive
offices are currently located at 8320 Guilford Road, Columbia, Maryland 21046.
Our telephone number is (301) 854-3900.

RECENT DEVELOPMENTS

In April, 1999, Novavax entered into a Stock and Warrant Purchase
Agreement with 23 purchasers for the private placement of 1,651,100 shares of
its common stock and the issuance of warrants to the purchasers for the purchase
of an additional 412,775 shares of common stock (the "Private Placement"). One
of the principals of one of the investors is also a director and officer of
Novavax. The issuance price of the common stock was $2.50 per share. Each share
was sold together with a non-transferable warrant for the purchase of .25
additional shares at an exercise price of $3.75. The warrants have a three-year
term. Gross proceeds from the Private Placement were $4,128,000. The placement
agents were paid $107,000 and 42,933 shares of Novavax common stock which were
issued together with non-transferable warrants for the purchase of 10,733 shares
of Novavax common stock exercisable at a price of $3.75 for a three-year term.
Additionally, the placement agents were issued non-transferable warrants for the
purchase of 143,000 shares of Novavax common stock exercisable at a price of
$3.00 per share for a three-year term.

RISK FACTORS

An investment in the Novavax shares involves a significant risk. To
determine whether to purchase the shares, prospective investors should carefully
consider the risk factors identified below, the other information presented in
this prospectus, and should obtain from Novavax any further information
necessary to their full understanding of such risk factors.

NOVAVAX HAS NOT COMPLETED THE DEVELOPMENT OF ANY PRODUCT AND OUR ABILITY TO DO
SO IS UNCERTAIN

All of our potential products are still in various stages of
pre-clinical research or clinical trials. We do not expect to have any products
available for commercial sale for at least two years. Significant further
research and development, pre-clinical and clinical testing, regulatory approval
and additional financing are all necessary before any commercial sale of any
product.

We are not certain whether we will be able to complete and sell any
product. The development of pharmaceutical products based on new technologies is
subject to a variety of inherent risks of failure. These risks include the
following:

o Our potential products may be found to be unsafe, ineffective or
otherwise fail to meet regulatory standards or receive necessary
regulatory approvals.

o Our potential products may be too difficult or costly to
manufacture on a large scale, to develop into commercially viable
products or to market.

o Our potential products may not be accepted by the medical
community.

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o Other companies may market superior or equivalent products.

o Other parties may claim proprietary rights to our product
technology that prevent us from marketing our products.

o We may be unable to raise enough money to finance our continued
product development.

NOVAVAX HAS INCURRED SUBSTANTIAL OPERATING LOSSES AND OUR FUTURE
PROFITABILITY IS UNCERTAIN

Our expenses have exceeded our revenues since the formation of the
company in 1995 and our accumulated deficit at the end of 1998 was $38,388,000.
We have received a very limited amount of product-related revenue from research
contracts and product licenses to provide vaccine products, services and
adjuvant technologies. Our net losses for the years ended December 31, 1996,
1997 and 1998 were $5,494,985, $4,546,617 and $4,817,000, respectively, while
revenues for the same periods were $56,000, $520,000 and $681,000, respectively.
Our losses have resulted from expenses related to our product research and
development programs, protection of our patents and other intellectual property
and from other general operating expenses. We expect that our annual losses will
increase in the near-term as we conduct additional and larger clinical trials
and seek regulatory approval for advanced stage product candidates. We expect
that our only sources of revenue for the foreseeable future will be from
possible collaborative partners, product licensees and investment income. We do
not expect revenues from commercial sales of products for at least two years, if
at all. We cannot be certain that we will be successful in entering into
strategic alliances or collaborative arrangements with other companies that will
result in significant revenues. Therefore, we expect our cumulative operating
loss to increase until such time, if ever, as product sales, licensing fees and
royalty payments generate sufficient revenue to fund our continuing operations.
We cannot predict when, if ever, we might achieve profitability and cannot be
certain that we will be able to sustain profitability, if achieved.

NOVAVAX WILL NEED SUBSTANTIAL ADDITIONAL CAPITAL AND IS UNCERTAIN OF
OBTAINING FUTURE FINANCING

We estimate that the net proceeds of our April, 1999 private placement,
together with our existing cash resources, will be sufficient to finance our
operations at current and projected levels of development and general corporate
activity for the next 12 to 13 months. Thereafter, we will require substantial
additional funds to continue our research and development, commence future
pre-clinical and clinical trials, seek regulatory approvals, establish
commercial-scale manufacturing capabilities and market our products. We may seek
additional funds for these purposes through public or private equity or debt
financings, collaborative arrangements with pharmaceutical companies and other
sources. We cannot be certain that adequate additional funding or bank financing
will be available to us on acceptable terms when we need it, if at all. If we
cannot raise all the additional funds we need to continue our current and
anticipated operations, we may be required to significantly delay, reduce the
scope of or eliminate one or more of our research or development programs, or
seek other alternatives to avoid insolvency, including arrangements with
collaborative partners or others that may require Novavax to relinquish rights
to certain of its technologies, product candidates or products. Any such change
in our plan of operations will adversely affect our ability to generate revenues
and achieve profitability.

NOVAVAX DEPENDS ON PATENTS AND OTHER PROTECTION OF ITS PROPRIETARY RIGHTS

Our success will depend in large part on our ability to maintain the
proprietary nature of our technology and other trade secrets. To do so, we must
maintain existing patents, obtain new patents and pursue trade secret
protection. We also must operate without infringing the proprietary rights of
third parties or letting third parties infringe our rights. Novavax has 45
United States

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patents and 125 foreign patents covering its technologies, including its
Novamix(TM) production equipment. However, patent issues relating to
pharmaceuticals involve complex legal, scientific and factual questions. To
date, no consistent policy has emerged regarding the breadth of biotechnology
patent claims that are granted by the United States Patent and Trademark Office
or enforced by the federal courts. Therefore, we do not know whether our
applications will result in the issuance of patents, or that any patents issued
to Novavax will provide us with any competitive advantage. We also cannot be
sure that Novavax will develop additional proprietary products that are
patentable. Furthermore, there is a risk that others will independently develop
or duplicate similar technology or products or circumvent the patents issued to
Novavax. Our inability to obtain or maintain patent protection for our products
could have a material adverse effect on our financial condition.

There is risk that third parties may challenge Novavax's existing
patents or may claim that Novavax is infringing their patents or proprietary
rights. We could incur substantial costs in defending patent infringement suits
or in filing suits against others to have their patents declared invalid. It is
also possible that we may be required to obtain licenses from third parties to
avoid infringing third party patents or other proprietary rights. We cannot be
sure that such third party licenses would be available to us on acceptable
terms, if at all. If we are unable to obtain required third party licenses, we
may be delayed in or prohibited from developing, manufacturing or selling
products requiring such licenses.

Some of our know-how and technology is not patentable. To protect our
proprietary rights in unpatentable intellectual property and trade secrets, we
require employees, consultants, advisors and collaborators to enter into
confidentiality agreements. These agreements may not provide meaningful
protection for Novavax's trade secrets, know-how or other proprietary
information in the event of any unauthorized use or disclosure.

NOVAVAX FACES INDUSTRY COMPETITION AND THE RISK OF TECHNOLOGICAL OBSOLESCENCE

Novavax competes with numerous other companies worldwide that have
developed or are developing novel drug delivery and encapsulation technologies.
These competitors include both large and small pharmaceutical companies,
biotechnology firms, universities and other research institutions. Novavax may
not succeed in developing technologies and products that are more effective than
those being developed by our competitors. Novavax's technologies and products
may be rendered obsolete or noncompetitive as a result of products introduced by
competitors. Most of our competitors have substantially greater financial and
technical resources, production and marketing capabilities and related
experience than Novavax. The greater resources, capabilities and experience of
our competitors may enable them to develop, manufacture and market their
products more successfully and at a lower cost than Novavax. In addition, many
of Novavax's competitors have significantly greater experience than Novavax in
conducting preclinical testing and clinical trials of human pharmaceuticals and
obtaining regulatory approvals to market such products. Accordingly, Novavax's
competitors may succeed in obtaining FDA approval for products more rapidly than
Novavax which may give them an advantage over Novavax in achieving market
acceptance of their products.

NOVAVAX NEEDS TO ESTABLISH COLLABORATIVE RELATIONSHIPS TO
COMMERCIALIZE ITS PRODUCTS

Novavax has no significant marketing or manufacturing capability and its
drug development capability is limited in large part by its finances. Therefore,
our ability to successfully develop and commercialize our products depends in
large part on our success in entering into strategic alliances or licensing
arrangements with collaborative partners, primarily pharmaceutical companies. We
expect that these partners will assume various responsibilities for product

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commercialization including conducting clinical trials, submitting applications
for regulatory approval, manufacturing product supplies and marketing approved
products. We may not be able to negotiate collaborative arrangements on
acceptable terms. Even if such collaborations are established, they may not be
scientifically or commercially successful. There is a risk that our
collaborative partners may fail to perform their obligations to develop,
manufacture or market our products in which case Novavax's business may be
adversely affected. We also face the risk that Novavax's collaborative partners
may develop competing technologies for treating the diseases and conditions
targeted by Novavax's products, either on their own or in collaboration with
others.

In certain circumstances, it may be advantageous for us to retain
manufacturing rights for some of the products that we license to collaborative
partners. However, we cannot be sure that Novavax will be able to retain such
rights on acceptable terms, if at all, or that Novavax will have the ability to
produce the quantities of product required under the terms of such arrangements.
Our reliance on collaborative arrangements for product development and
commercialization may result in lower revenues from royalties and other payments
than Novavax could have generated had it commercialized and marketed products
itself.

NOVAVAX DEPENDS ON KEY EMPLOYEES

We are highly dependent on the principal members of our scientific and
managerial staff and the loss of their services could have a material adverse
effect on Novavax. As of the date of this prospectus, the combined position of
President and Chief Executive Officer and the position of Chief Financial
Officer have been filled on an interim basis since September 1998 and February
1999, respectively. Other recent management position vacancies have not yet been
filled. Our success depends on attracting and retaining qualified candidates to
fill these positions on a permanent basis. It is also critical to recruit and
retain qualified scientific personnel to perform research and development work
in the future. Our anticipated growth and expansion into areas and activities
requiring additional expertise such as clinical testing, governmental approvals,
production and marketing will also require the addition of new management
personnel and the development of additional expertise by current management
personnel. There is a risk that we will be unable to attract and retain the
personnel we need on acceptable terms given the competition among numerous
pharmaceutical companies, universities and non-profit research institutions for
experienced scientists and managers. If we are unable to obtain such services or
to develop such expertise, our business prospects may be adversely affected to a
material extent.

NOVAVAX CANNOT NOW MANUFACTURE COMMERCIAL QUANTITIES OF PRODUCT

Novavax has the ability to produce the limited quantities of Novasome
lipid vesicles it currently needs and the limited quantities of other products
needed to support its current research and development and early-stage clinical
trials. However, Novavax needs more production capacity for later clinical
trials and commercial production. We may elect to manufacture additional
supplies of our own products or contract with collaborative partners to do so.
If we elect to manufacture our own products, we will need to acquire additional
manufacturing facilities and to improve our manufacturing technology.
Establishing additional manufacturing facilities will require us to spend
substantial funds, hire and retain a significant number of additional personnel
and comply with extensive regulations applicable to such facilities here and
abroad, including the current good laboratory practices ("GLP") and good
manufacturing practices ("GMP") required by the FDA. We may not be able to
manufacture our products in a timely fashion at acceptable quality and prices or
in compliance with GLP and GMP.

If we rely on collaborators, licensees or contract manufacturers for the
commercial manufacture of our products, we will have only limited control over
the manufacturing of such products. We cannot be certain that outside
manufacturers will comply with applicable manufacturing standards or be able to
manufacture an adequate supply of product when needed at

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acceptable quality and prices. Also, Novavax may not be able to enter into any
such manufacturing arrangements on acceptable terms, if at all. If we are not
able to enter into commercial manufacturing agreements or successfully develop
our own commercial manufacturing capacity, we could encounter delays in
introducing our products into certain markets which would be likely to have a
material adverse impact on our revenues and results of operations.

NOVAVAX HAS NO SALES OR MARKETING EXPERIENCE AND MAY DEPEND ON
MARKETING PARTNERS

We expect to commercialize and sell certain products through
co-marketing arrangements with third parties. However, we may not be able to
attract such marketing partners on acceptable terms, if at all. To the extent we
do establish such marketing arrangements, our revenues will largely depend on
the efforts of those third parties whose efforts may not be successful or
profitable. We may also elect to build a small targeted direct sales group for
products in markets that can be accessed with a small to medium size sales
force, if and when such products approach FDA marketing approval. In order to
market our products directly, we would need to develop a marketing staff and
sales force with technical expertise. To date, however, Novavax has had no
experience in sales, marketing or distribution of its products. Therefore, we
may not be able to successfully build a marketing or sales team. If we can, the
cost of establishing such a marketing or sales team may exceed our product
revenue or the efforts of our direct sales and marketing team may not be
successful in competing with other companies that currently have extensive and
well-funded marketing and sales operations.

NOVAVAX PRODUCTS REQUIRE CLINICAL TESTING AND REGULATORY APPROVAL
BEFORE MARKETING

The development, manufacture and marketing of our pharmaceutical
products are subject to government regulation in the United States and other
countries. In the United States and most foreign countries, we must complete
rigorous preclinical testing and extensive human clinical trials that
demonstrate the safety and effectiveness of a product in order to apply for
regulatory approval to market the product. These processes are expensive and can
take many years to complete. We may not be able to demonstrate the safety and
efficacy of our products to the satisfaction of the FDA or other regulatory
authorities. Regulatory approval may not be obtained on a timely basis, if at
all. Novavax may also be required to demonstrate that its proposed product
represents an improved form of treatment over existing therapies and we may be
unable to do so without conducting further clinical studies, if at all.

Delays in obtaining regulatory approval can be extremely costly in terms
of lost sales opportunities and increased clinical trial costs. How quickly we
complete our clinical trials and our applications for marketing approval depends
on several factors, including the following:

o the rate of patient enrollment, which is a function of many
factors, including the size of the patient population, the
proximity of patients to clinical sites, the eligibility criteria
for the study and the nature of the protocol;

o institutional review board approval of the protocol and the
informed consent form;

o prior regulatory agency review and approval;

o analysis of data obtained from preclinical and clinical activities
which are susceptible to varying interpretations which
interpretations could delay, limit or prevent regulatory approval;

o changes in the policies of regulatory authorities for drug
approval during the period of product development; and

o the availability of skilled and experienced staff to conduct and
monitor clinical studies and to prepare the appropriate regulatory
applications.

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Novavax has limited experience in conducting and managing the
preclinical and clinical trials necessary to obtain regulatory marketing
approvals. Novavax may not be able to obtain the approvals necessary to conduct
clinical studies. Also, the results of our clinical trials may not be consistent
with the results obtained in preclinical studies or the results obtained in
later phases of clinical trials may not be consistent with those obtained in
earlier phases. A number of companies in the biopharmaceutical industry have
suffered significant setbacks in advanced clinical trials, even after
experiencing promising results in early animal and human testing. If regulatory
approval of a drug is granted, such approval is likely to limit the indicated
uses for which it may be marketed. Furthermore, even if a product of ours gains
regulatory approval, the product and the manufacture of the product will be
subject to continuing regulatory review. We may be restricted or prohibited from
marketing or manufacturing a product after obtaining product approval, or may
be required to recall a product, if previously unknown problems with the product
or its manufacture are subsequently discovered.

NOVAVAX OPERATING RESULTS MAY FLUCTUATE QUARTERLY

Our quarterly operating results are likely to vary significantly
depending on factors such as the timing of new license agreements, the results
of preclinical or clinical trials, the timing of collaborative agreements for
the development of products, the timing of significant orders and the
introduction of products by us. Our expense levels are based in part on our
expectations as to future revenue. If revenue levels are below expectations,
operating results will be adversely affected. Although we believe that
period-to-period comparisons of our operating results are not necessarily
meaningful and should not be relied upon as indications of future performance,
the price of our common stock could decline significantly if our revenue or
operating results fall below the expectations of public market analysts and
investors.

NOVAVAX PRODUCTS MAY BE SUBJECT TO PRODUCT LIABILITY CLAIMS

Although we are not currently a party to any product liability
litigation, the testing, manufacturing, marketing and sale of our human medical
products may subject us to the risk of substantial product liability claims
including claims made by consumers, health care providers, pharmaceutical
companies or others selling such products. We currently have limited product
liability coverage for the clinical research use of our product candidates. We
do not have product liability insurance for the commercial sale of our potential
product candidates but we intend to obtain such coverage if and when our
products are commercialized. Such insurance, however, is expensive, difficult to
obtain and may not be available in the future on acceptable terms, if at all. We
cannot assure you that we can maintain product liability insurance in the future
at a reasonable cost or in sufficient amounts to protect us against losses due
to product liability. An inability to maintain insurance at an acceptable cost
or to otherwise protect against potential product liability could prevent or
inhibit the continued commercialization of our products. In addition, a product
liability claim in excess of applicable insurance coverage, or a product recall,
could have a material adverse effect on our business, financial condition and
results of operations.

NOVAVAX IS RESPONSIBLE FOR ITS USE OF HAZARDOUS MATERIALS

Our product development and commercialization activities may involve the
controlled use of hazardous materials, chemicals, viruses, bacteria and other
pathogens. Although we believe that our safety procedures for handling and
disposing of such materials comply with the standards prescribed by state,
federal and local regulations, the risk of accidental contamination or injury
from these materials cannot be completely eliminated. In the event of an
accident involving such materials, we could be held liable for any damages that
result and our liability could exceed our ability to pay such damages. We also
may be required to incur significant costs to comply with environmental laws and
regulations in the future.

9
<PAGE> 12

PRODUCT REVENUES WILL DEPEND ON THIRD-PARTY REIMBURSEMENT WHICH IS UNCERTAIN

Our ability to sell products in both domestic and foreign markets will
depend, in part, on the availability of reimbursement from third-party payers,
such as government health administration authorities, private health insurers
and other organizations. Government and other third-party payers are
increasingly attempting to contain medical costs by limiting both coverage and
the level of reimbursement of new therapeutic products approved for marketing by
the FDA and by refusing, in some cases, to provide coverage for uses of approved
products for disease indications for which the FDA has not granted marketing
approval. Consequently, we cannot be certain that third party payers will
provide reimbursement for purchases of our products. Third-party payers are also
increasingly challenging the price and cost-effectiveness of medical products.
We cannot be certain that our products will be considered cost effective. If
adequate third-party reimbursement is not available for our products, we may not
be able to establish and maintain product price levels sufficient for
realization of an appropriate return on our investment in developing new
products and it is likely that market acceptance of these products would be
adversely affected. These consequences of inadequate reimbursement for our
products could have a material adverse effect on our business, financial
condition and results of operations.

THE IMPACT OF MEDICAL REFORM MEASURES IS UNCERTAIN

There have been a number of federal and state proposals during the last
few years to subject the pricing of pharmaceuticals to government control and to
make other changes to the medical care system of the United States. It is
uncertain what legislative proposals will be adopted or what actions federal,
state or private payers for medical goods and services may take in response to
any medical reform proposals or legislation. We cannot predict the effect these
reforms may have on our business and no assurance can be given that any such
reforms will not have a material adverse effect on our results of operations.

NOVAVAX STOCK IS SUBJECT TO SUBSTANTIAL PRICE FLUCTUATIONS AND
POSSIBLE DELISTING; NO DIVIDENDS ARE LIKELY

The market prices for securities of biotechnology and pharmaceutical
companies like Novavax have historically been highly volatile and it is likely
that the market price of our common stock will continue to be highly volatile.
During calendar 1998, the closing price of our common stock on the American
Stock Exchange (the "AMEX") ranged between a low of $1.25 per share and a high
of $6.125 per share. Factors that may contribute to significant fluctuations in
the market price of Novavax common stock include the following:

o announcements of technological innovations or new commercial
products by Novavax or its competitors;

o publicity regarding actual or potential medical results relating
to products under development by us or our competitors;

o regulatory developments;

o disputes concerning patent or proprietary rights;

o public concern as to the safety of our products;

o economic and other external factors unrelated to our business or
operations; and

o period-to-period fluctuations in financial results.

Our common stock is currently traded on the AMEX. A failure to continue
to meet the AMEX's maintenance requirements may result in a delisting of the
common stock. In particular, we may have difficulty maintaining the minimum
market capitalization requirements of the AMEX because such capitalization is
dependent on the price at which the shares of our common stock trade from time
to time. If our stock were delisted from the AMEX, it would probably be traded
in

10
<PAGE> 13

over-the-counter markets. This would be likely to impair the ability of
investors to trade our stock as a result of limitations on the number of shares
they could buy or sell, delays in the timing of transactions, reductions in news
coverage of the company by security analysts and the media, and lower prices
than might otherwise be attained.

We have never paid cash dividends on our common stock and do not
anticipate paying any cash dividends in the foreseeable future.

INVESTORS RISK DILUTION OF THEIR INVESTMENT

As of December 31, 1998, there were outstanding stock options to
purchase an aggregate of 3,554,247 shares of Novavax common stock at a weighted
average exercise price of $3.52 per share. In addition, as of December 31, 1998,
there were outstanding warrants to purchase an aggregate of 1,300,000 shares of
common stock at a weighted average exercise price of $6.80 per share. Investors
purchasing the shares offered hereby may incur dilution of their investment to
the extent that these outstanding options and warrants are exercised at a lower
price than investors pay for the shares they purchase.

ANTI-TAKEOVER PROVISIONS MAY AFFECT NOVAVAX STOCK PRICE AND STOCKHOLDER CONTROL

Novavax's Amended and Restated Certificate of Incorporation requires
that any action required or permitted to be taken by stockholders of Novavax
must be effected at a duly called annual or special meeting of stockholders and
may not be effected by any consent in writing, and will require reasonable
advance notice by a stockholder of a proposal or director nomination which such
stockholder desires to present at any annual or special meeting of stockholders.
Special meetings of stockholders may be called only by the Chief Executive
Officer or, if none, the President of Novavax or the Board of Directors. The
Restated Certificate of Incorporation also provides for a classified Board of
Directors and members of the Board of Directors may be removed only for cause
upon the affirmative vote of holders of at least two-thirds of the shares of
capital stock of Novavax entitled to vote. The Board of Directors also has the
authority, without further action by the stockholders, to fix the rights and
preferences of, and issue shares of, preferred stock.

These provisions and other provisions of Novavax's Restated Certificate
of Incorporation and By-Laws, may have the effect of deterring hostile takeovers
or delaying or preventing changes in control or management of Novavax, including
transactions in which stockholders might otherwise receive a premium for their
shares over then current market prices. In addition, these provisions may limit
the ability of stockholders to approve transactions that they may deem to be in
their best interests.

YEAR 2000 ISSUES MAY ADVERSELY IMPACT NOVAVAX'S FINANCIAL AND
MANAGEMENT RESOURCES

We are evaluating and working to resolve the potential impact of the
Year 2000 on our computerized information systems' ability to accurately process
information that may be date-sensitive. Any software we use that recognizes a
date using "00" as the year 1900 rather than the year 2000, could result in
errors or system failures. We primarily use personal computers for
administrative and accounting systems. In addition, we have certain laboratory
equipment with microprocessors.

We are in the process of surveying our material business partners and
suppliers to determine their Year 2000 readiness. Our relationship with these
parties is such that if they were unable to become Year 2000 compliant, Novavax
would be adversely affected. These

11
<PAGE> 14

relationships encompass many areas that affect our ability to do business
including financial institutions, utility companies and contract manufacturers.

We don't believe that we will incur material incremental costs in our
efforts to address Year 2000 issues and we have not incurred incremental costs
to date. We have not been given any indication that our business partners and
suppliers will not be Year 2000 compliant by the Year 2000. However, we plan to
continue to monitor and address any significant Year 2000 issues until we are
assured that our business will not be adversely affected.

SELLING STOCKHOLDERS

The following table sets forth certain information with respect to the
selling stockholders, including (i) the name of the selling stockholders, (ii)
the number of shares of common stock owned by the selling stockholders prior to
the offering and (iii) the maximum number of shares of such common stock to be
offered hereby. Because the selling stockholders may offer and sell all or a
portion or none of the common stock offered pursuant to this Prospectus, no
estimate can be given as to the amount of common stock that will be held by the
selling stockholders upon termination of the offering. The information in the
table below has been obtained from the selling stockholders by a placement agent
for the Private Placement. See "Plan of Distribution."

The shares being offered hereby by the selling stockholders consist of
1,694,033 shares issued in April, 1999 to the purchasers and placement agents in
the Private Placement and an additional 566,508 shares that may be acquired,
from time to time, upon the exercise of warrants issued to the selling
stockholders in connection with the Private Placement. This Prospectus covers
the resale by the selling stockholders of these 2,260,541 shares plus, in
accordance with Rule 416 under the Securities Act, such presently indeterminate
number of additional shares as may be issuable upon exercise of the warrants by
reason of anti-dilution provisions, stock splits, stock dividends and other
similar transactions. Novavax's offer and sale of the shares to the selling
stockholders was made pursuant to an exemption from registration under Section
4(2) of the Securities Act. See "Recent Developments."

The shares covered by this prospectus may be offered from time to time
by the selling stockholders named below or their transferees, pledgees, donees
and other successors as described under "Plan of Distribution":

<TABLE>
<CAPTION>
Number of Shares Maximum Number
Beneficially Owned of Shares
Name of Selling Stockholder Prior to Offering(2) Being Offered(1)
- ----------------------------------------------------------------------------------------------
<S> <C> <C>
1. Columbine Financial Solutions, Inc. 716,000(3) 716,000(3)
2. Anaconda Opportunity Fund, L.P.(4) 2,450,000(5) 275,000
3. W. D. Moreland 250,000 250,000
4. Robertson Stephens Investment
Management 200,000 200,000
5. William J. Ritger 187,000(6) 125,000
6. Jon B. Kruljac and Teri E. Kruljac 135,666(7) 105,666(7)
7. Boston Holdings Inc. 75,000 75,000
8. Richard A. Smudz 75,000 75,000
9. Ben Bee 80,025 50,125
10. John Lathrop Stonecipher and Ingrid
Arden Stonecipher, Trustees 70,000 50,000
11. Kelly McDermott 50,000 50,000
12. Kory McGavin 37,500 37,500
13. Saul H. Bernstein and Elizabeth A. Bernstein 70,250 31,250
</TABLE>

12
<PAGE> 15

<TABLE>
<S> <C> <C>
14. Mark Hess 125,000 25,000
15. Stephanie L. Kenkel 113,000 25,000
16. George Resta 50,000 25,000
17. James A. Risher 50,000 25,000
18. Montgomery L. Studebaker 25,000 25,000
19. Jack A. Wilkinson, Trustee,
Wilkinson Family Trust #1 25,000 25,000
20. Ross Lyndon-James 20,000 20,000
21. Kathleen M. Walker 15,000 15,000
22. Fiserve Correspondent Services, Inc.,
Custodian f/b/o Kathleen M. Walker 10,000 10,000
23. Fiserve Correspondent Services, Inc.,
Custodian f/b/o Barry Ollman 12,500 12,500
24. Susan S. Duboc 12,500 12,500
------ ---------
Total 4,854,441 2,260,541
</TABLE>

(1) Represents the number of shares of common stock acquired by each selling
stockholder in the Private Placement together with the number of additional
shares that each selling stockholder may purchase pursuant to warrants acquired
in the Private Placement. Each warrant may be exercised from time to time
through April 15, 2002. Except as indicated by other footnotes, one fifth of
the shares offered by each selling stockholder represent shares that may be
acquired pursuant to such warrants.

(2) Includes shares that may be acquired pursuant to options and warrants
exercisable within 60 days hereof and shares in which a selling stockholder has
a direct or indirect beneficial ownership interest.

(3) Includes 195,000 shares that may be acquired pursuant to warrants
exercisable within 60 days hereof.

(4) Mitchell J. Kelly, a director and officer of the Company, is the sole
general partner of Anaconda Capital, L.P., the general partner of the Anaconda
Opportunity Fund, L.P., and therefore is deemed to share beneficial ownership of
the shares beneficially owned by the Anaconda Opportunity Fund by reason of
his power to vote and control those shares.

(5) Includes 1,255,000 shares that may be acquired pursuant to warrants that may
be exercised within 60 days hereof. Excludes shares directly owned by Mitchell
J. Kelly, a director and officer of Novavax and the general partner of the
general partner of the Anaconda Opportunity Fund, L.P.

(6) Includes 50,000 shares that may be acquired within 60 days hereof pursuant
to warrants held by the Research Works, Inc., of which William Ritger is the
sole stockholder, and 3,200 shares owned in the name of his minor children.

(7) Includes 83,733 shares that may be acquired pursuant to warrants
exercisable within 60 days hereof.

USE OF PROCEEDS

Novavax will not receive any proceeds from the sale of the shares by the
selling stockholders.

13
<PAGE> 16

PLAN OF DISTRIBUTION

The selling stockholders may sell the shares subject to this prospectus
and the Registration Statement of which it forms a part from time to time in
open market or privately negotiated transactions. Pursuant to the Stock and
Warrant Purchase Agreement dated April 14, 1999, Novavax has agreed to keep the
Registration Statement effective until the second anniversary of the date the
Registration Statement is declared effective (or, in the case of shares issued
under the selling stockholders' Private Placement warrants, the first
anniversary of the date the warrant shares are issued, but in any event not
later than the fourth anniversary of the date the Registration Statement is
declared effective); except that if Rule 144 is amended so that the longest
period that Rule 144 restricts the manner in which privately placed securities
may be sold is a period shorter than two years, then Novavax is only obligated
to keep this Registration Statement effective for such shorter period or until
such date as all of the registered shares have been resold or may be sold
pursuant to Rule 144 or a successor rule. Novavax intends to deregister any of
the shares not sold by the selling stockholders at the end of such period.

The selling stockholders may sell the shares from time to time in
transactions on the AMEX, in the over-the-counter market, in negotiated
transactions, or a combination of such methods of sale. The shares may be sold
at fixed prices which may be changed, at market prices prevailing at the time
of sale, at prices related to such prevailing market prices or at negotiated
prices. The selling stockholders may effect such transactions by any means
permitted by law. These means may include selling the shares to or through
broker-dealers, including block trades or cross trades, or in one or more
underwritten offerings on a firm commitment or best efforts basis. Sales of
selling stockholders' shares may also be made pursuant to Rule 144 under the
Securities Act, where applicable.

The selling stockholders may also transfer their shares by gift,
pledge or other means not involving a sale transaction. If this occurs, the
transferees will be able to offer such shares as selling stockholders under this
prospectus.

A selling stockholder may, from time to time, sell short the common
stock of Novavax, and in such instances, this prospectus may be delivered in
connection with such short sales and the shares offered hereby may be used to
cover such short sales. A selling stockholder may also (1) enter into hedging
transactions with broker-dealers and the broker-dealers may engage in short
sales of the shares in the course of hedging the position they assume with such
selling stockholder, including in connection with distributions of the shares
by such broker-dealers, (2) enter into options or other transactions with
broker-dealers that involve the delivery of the shares to the broker-dealers,
who may then resell or otherwise transfer such shares, and (3) loan or pledge
the common stock to a broker-dealer who may sell the loaned shares.

14
<PAGE> 17
In order to comply with the securities laws of certain states, if
applicable, the shares will be sold in such jurisdictions only through
registered or licensed brokers or dealers. In addition, in certain states the
shares may not be sold unless they have been registered or qualified for sale in
the applicable state or an exemption from the registration or qualification
requirement is available and is complied with.

The selling stockholders and any broker-dealers who act in connection
with the sale of shares hereunder may be deemed to be "underwriters," as such
term is defined in the Securities Act, and any commissions received by them or
profit on any resale of the shares might be deemed to be underwriting discounts
and commissions under the Securities Act.

Under applicable rules and regulations under the Exchange Act, any
person engaged in the distribution of the shares may not bid for or purchase
shares of common stock during a period which commences one business day (5
business days, if Novavax's public float is less than $25 million or its
average daily trading volume is less than $100,000) prior to such person's
participation in the distribution, subject to exceptions for certain passive
market making activities. In addition, each selling stockholder will be subject
to provisions of the Exchange Act and the rules and regulations thereunder,
including Regulation M. These provisions may limit the timing of purchases and
sales of shares of Novavax common stock by a selling stockholder. In addition,
the selling stockholders have agreed under the terms of the Stock and Warrant
Purchase Agreement to which they are a party, that Novavax may restrict the sale
of these registered securities for periods of up to 30 days by written notice to
the selling stockholders if Novavax deems this to be necessary because a sale
pursuant to this Registration Statement in its then-current form would not be in
the best interest of the Company and its shareholders due to disclosure
obligations of the company.

Pursuant to the Stock and Warrant Purchase Agreement, Novavax agreed to
register the shares under the Securities Act and to indemnify and hold the
selling stockholders harmless against certain liabilities, including certain
liabilities under the Securities Act, that could arise in connection with the
sale by the selling stockholders of the shares. Novavax has agreed to bear
certain expenses (other than selling commissions) in connection with the
registration and sale of the shares being offered by the selling stockholders,
estimated to be $33,500.

LEGAL MATTERS

Certain legal matters with respect to the shares of common stock offered
hereby have been passed upon by White & McDermott, P.C., 65 William Street,
Wellesley, Massachusetts 02481. David A. White, a director and stockholder of
the firm, owns 22,500 shares of Novavax common stock and is the Secretary of
Novavax

EXPERTS

The consolidated financial statements incorporated in this prospectus by
reference to the Annual Report on Form 10-K for the year ended December 31,
1998, have been so incorporated in

15
<PAGE> 18

reliance on the report of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.

INDEMNIFICATION

Article NINTH of Novavax's Restated Certificate of Incorporation
provides that a director or officer of the Company (a) shall be indemnified by
the Company against all expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement incurred in connection with any litigation or
other legal proceeding (other than an action by or in the right of the Company)
brought against him by virtue of his position as a director or officer of the
Company if he acted in good faith and in a manner he reasonably believed to be
in, or not opposed to, the best interests of the Company, and, with respect to
any criminal action or proceeding, had no reasonable cause to believe his
conduct was unlawful and (b) shall be indemnified by the Company against all
expenses (including attorneys' fees) and amounts paid in settlement incurred in
connection with any action by or in the right of the Company brought against him
by virtue of his position as a director or officer of the Company if he acted in
good faith and in a manner he reasonably believed to be in, or not opposed to,
the best interests of the Company, except that no indemnification shall be made
with respect to any matter as to which such person shall have been adjudged to
be liable to the Company, unless a court determines that, despite such
adjudication but in view of all of the circumstances, he is entitled to
indemnification of such expenses. Notwithstanding the foregoing, to the extent
that a director or officer has been successful, on the merits or otherwise,
including, without limitation, the dismissal of an action without prejudice, he
is required to be indemnified by the Company against all expenses (including
attorneys' fees) incurred in connection therewith. Expenses shall be advanced to
a director or officer at his request, provided that he undertakes to repay the
amount advanced if it is ultimately determined that he is not entitled to
indemnification for such expenses.

Indemnification is required to be made unless the Company determines
that the applicable standard of conduct required for indemnification has not
been met. In the event of a determination by the Company that the director or
officer did not meet the applicable standard of conduct required for
indemnification, or if the Company fails to make an indemnification payment
within 60 days after such payment is claimed by such person, such person is
permitted to petition the court to make an independent determination as to
whether such person is entitled to indemnification. As a condition precedent to
the right of indemnification, the director or officer must give the Company
notice of the action for which indemnity is sought and the Company has the right
to participate in such action or assume the defense thereof.

Article NINTH of the Novavax's Restated Certificate of Incorporation
further provides that the indemnification provided therein is not exclusive, and
provides that in the event that the Delaware General Corporation Law is amended
to expand the indemnification permitted to directors or officers the Company
must indemnify those persons to the fullest extent permitted by such law as so
amended.

Section 145 of the Delaware General Corporation Law provides that a
corporation has the power to indemnify a director, officer, employee or agent of
the corporation and certain other persons serving at the request of the
corporation in related capacities against amounts paid and expenses incurred in
connection with an action or proceeding to which he is or is threatened to be
made a party by reason of such position, if such person shall have acted in good
faith and in a manner he reasonably believed to be in or not opposed to the best
interests of the corporation, and, in any criminal proceeding, if such person
had no reasonable cause to believe his conduct was unlawful, provided that, in
the case of actions brought by or in the right of the corporation, no
indemnification shall be made with respect to any matter as to which such person
shall have been adjudged to be liable to the corporation unless and only to the
extent that the adjudicating court determines that such indemnification is
proper under the circumstances.

16
<PAGE> 19

The Company maintains insurance under which the insurers will reimburse
the Company for amounts that it has paid to its directors and officers as
indemnification for claims against such persons in their official capacities.
The insurance also covers such persons as to amounts paid by them as a result of
claims against them in their official capacities that are not reimbursed by the
Company. The insurance is subject to certain limitations and exclusions.

Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers or persons controlling the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is
therefore unenforceable.

<PAGE> 20

NO DEALER, SALESPERSON OR OTHER PERSON HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATION NOT CONTAINED IN THIS PROSPECTUS AND,
IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS
HAVING BEEN AUTHORIZED BY NOVAVAX OR ANY UNDERWRITER. THIS PROSPECTUS DOES NOT
CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY OF THE
SECURITIES OFFERED HEREBY IN ANY JURISDICTION TO ANY PERSON TO WHOM IT IS
UNLAWFUL TO MAKE SUCH OFFER IN SUCH JURISDICTION. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALE MADE HEREUNDER SHALL, UNDER ANY CIRCUMSTANCES, CREATE
ANY IMPLICATION THAT THE INFORMATION HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT
TO THE DATE HEREOF OR THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF NOVAVAX
SINCE SUCH DATE.

------------------------------------

TABLE OF CONTENTS

<TABLE>
<CAPTION>
Page
----
<S> <C>
Incorporation of Certain Documents by Reference ............................ 2
Available Information ...................................................... 2
Special Note Regarding Forward-Looking Statements .......................... 3
The Company ................................................................ 3
Recent Developments ........................................................ 4
Risk Factors ............................................................... 4
Selling Stockholders........................................................ 12
Use of Proceeds............................................................. 13
Plan of Distribution........................................................ 14
Legal Matters............................................................... 15
Experts..................................................................... 15
Indemnification............................................................. 16
</TABLE>

------------------------------------

NOVAVAX, INC.
2,260,541 SHARES OF COMMON STOCK
PROSPECTUS

<PAGE> 21

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS - FORM S-3

Item 14. Other Expenses of Issuance and Distribution.

The expenses to be borne by the Company in connection with this offering
are as follows:

<TABLE>
<S> <C>
SEC Registration Fee......................................... $ 2,318.

AMEX Listing Fee............................................. 17,500.

Legal Services and Expenses.................................. 8,500.*

Accounting Services and Expenses............................. 5,000.*

Miscellaneous expenses....................................... 182.*
--------
Total ............................................... $33,500.*
</TABLE>

- ------------------------
*Estimated

Item 15. Indemnification of Directors and Officers.

19
<PAGE> 22

condition precedent to the right of indemnification, the director or officer
must give the Company notice of the action for which indemnity is sought and the
Company has the right to participate in such action or assume the defense
thereof.

Article NINTH of Novavax's Restated Certificate of Incorporation further
provides that the indemnification prided therein is not exclusive, and provides
that in the event that the Delaware General Corporation Law is amended to expand
the indemnification permitted to directors or officers the Company must
indemnify those persons to the fullest extent permitted by such law as so
amended.

Item 16. Exhibits.

See Exhibit Index, incorporated herein by reference.

Item 17. Undertakings.

(a) The undersigned Registrant hereby undertakes:

(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this Registration Statement:

(i) to include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;

(ii) to reflect in the prospectus any facts or events arising after the
effective date of the Registration Statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a
fundamental change in the information set forth in the Registration Statement.
Notwithstanding the foregoing, any increase or decrease in volume of securities

20
<PAGE> 23

offered (if the total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of prospectus
filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20% change in the maximum
aggregate offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement.

(iii) to include any material information with respect to the plan of
distribution not previously disclosed in the Registration Statement or any
material change to such information in the Registration Statement;

provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or furnished to the
Commission by the Company pursuant to Sections 13 or 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in the Registration
Statement.

(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.

(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.

(b) The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

(c) The undersigned Registrant hereby undertakes to deliver or cause to
be delivered with the prospectus, to each person to whom the prospectus is sent
or given, the latest annual report to security holders that is incorporated by
reference in the prospectus and furnished pursuant to and meeting the
requirements of Rule 14a-3 or Rule 14c-3 under the Securities Exchange Act of
1934; and, where interim financial information required to be presented by
Article 3 of Regulation S-X are not set forth in the prospectus, to deliver, or
cause to be delivered to each person to whom the prospectus is sent or given,
the latest quarterly report that is specifically incorporated by reference in
the prospectus to provide such interim financial information.

<PAGE> 24

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of New York, New York, on April 29, 1999.

NOVAVAX, INC.

By: /s/ Mitchell J. Kelly
-----------------------------
Mitchell J. Kelly
Interim President and
Chief Executive Officer

POWER OF ATTORNEY

We, the undersigned officers and directors of Novavax, Inc., hereby severally
constitute and appoint Mitchell J. Kelly and David A. White, and each of them
singly, our true and lawful attorneys-in-fact, with full power to them in any
and all capacities, to sign any amendments to this Registration Statement on
Form S-3 (including Pre- and Post-Effective Amendments), and to file the same,
with exhibits thereto and other documents in connection therewith, with the
Securities and Exchange Commission, hereby ratifying and confirming all that
each of said attorneys-in-fact may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.

<TABLE>
<CAPTION>
NAME TITLE DATE
- ---- ----- ----
<S> <C> <C>
/s/ Mitchell J. Kelly Interim President and April 29, 1999
- --------------------------- Chief Executive Officer
Mitchell J. Kelly and Director

/s/ Donald J. MacPhee Principal Financial & April 29, 1999
- --------------------------- Accounting Officer
Donald J. MacPhee

/s/ Gary C. Evans Director April 29, 1999
- ---------------------------
Gary C. Evans

/s/ J. Michael Lazarus Director April 29, 1999
- ---------------------------
J. Michael Lazarus
</TABLE>

22
<PAGE> 25

<TABLE>
<S> <C> <C>
/s/ John O. Marsh, Jr. Director April 29, 1999
- ---------------------------
John O. Marsh, Jr.

/s/ Michael A. McManus Director April 29, 1999
- ---------------------------
Michael A. McManus

/s/ Denis M. O'Donnell Director April 29, 1999
- ---------------------------
Denis M. O'Donnell

/s/ Ronald A. Schiavone Director April 29, 1999
- ---------------------------
Ronald A. Schiavone

/s/ Ronald H. Walker Director April 29, 1999
- ---------------------------
Ronald H. Walker
</TABLE>

<PAGE> 26

EXHIBIT INDEX

The exhibits marked with an asterisk are filed herewith. The remainder
of the exhibits have heretofore been filed with the Commission and are
incorporated herein by reference.

<TABLE>
<CAPTION>
Page
----
<S> <C> <C>
4.1 Restated Certificate of Incorporation of the Registrant. (Incorporated by
reference to Exhibit 3.1 to the Registrant's Registration Statement File No.
0-26770 filed September 14, 1995 on Form 10 (the "Registration Statement").) --

4.2 Specimen stock certificate for shares of Common Stock, par value $.01
per share. (Incorporated by reference to Exhibit 4.1 to the Registration
Statement.) --

4.3 Stock and Warrant Purchase Agreement dated April 14, 1999 between the
Company and the purchasers identified therein. (Incorporated by
reference to Exhibit 10.16 to the Registrant's Annual Report on Form
10-K, File No. 0-26770 filed April 15, 1999). --

5.1* Opinion and Consent of White & McDermott, P.C. 25

23.1* Consent of PricewaterhouseCoopers LLP, independent accountants. 26

23.2* Consent of White & McDermott, P.C. (Contained in its opinion filed
as Exhibit 5.1 to this Registration Statement.) --

24.1* Power of Attorney. (Included in the signature pages hereto.) --
</TABLE>

<PAGE> 1

EXHIBIT 5.1

WHITE & MCDERMOTT, P.C.
65 William Street
Wellesley, MA 02481

April 29, 1999

Novavax, Inc.
8320 Guilford Road
Columbia, MD 21046

Gentlemen:

We have assisted with the preparation of a Registration Statement on
Form S-3 (the "Registration Statement"), filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, relating to the
registration of 2,260,541 shares of common stock, $.01 par value per share (the
"Common Stock"), of Novavax, Inc., a Delaware corporation (the "Company"), of
which 1,694,033 were acquired by various purchasers and placement agents in
connection with the closing of the Company's private placement under the terms
of a Stock and Warrant Purchase Agreement dated April 14, 1999 between the
Company and those purchasers identified therein (the "Purchased Shares"), and
566,508 of which may be acquired by those purchasers and placement agents upon
the exercise of warrants issued in connection with the private placement (the
"Warrant Shares").

We have examined the most recent Amendment to the Certificate of
Incorporation, the Restated Certificate of Incorporation and the By-laws of the
Company, and all amendments thereto, and have examined and relied on originals,
or copies certified to our satisfaction, of such records of meetings, written
actions in lieu of meetings, or resolutions adopted at meetings, of the
directors of the Company, and such other documents and instruments as in our
judgment are necessary or appropriate to enable us to render the opinions
expressed below.

In our examination of the foregoing documents, we have assumed (i) the
genuineness of all signatures and the authenticity of all documents submitted to
us as originals, (ii) the conformity to original documents of all documents
submitted to us as certified or photostatic copies and (iii) the authenticity of
the originals of the latter documents.

Based upon and subject to the foregoing, we are of the opinion that (i)
the Purchased Shares have been duly and validly authorized and issued and are
fully paid and non-assessable, and (ii) the Warrant Shares have been duly and
validly authorized for issuance and when issued on the terms contemplated by the
warrants and the Stock and Warrant Purchase Agreement, will be fully paid and
non-assessable.

We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name under the caption "Legal
Matters" in the prospectus forming a part of the Registration Statement.

Very truly yours,

White & McDermott, P.C.

By: /s/ David A. White
---------------------------
David A. White

<PAGE> 1

EXHIBIT 23.1

CONSENT OF INDEPENDENT ACCOUNTANTS

We consent to the incorporation by reference in this registration
statement of Novavax, Inc. on Form S-3 of our report dated March 17, 1999,
except for the fourth paragraph of Note 1 which is as of April 14, 1999,
relating to the consolidated financial statements which appear in Novavax Inc.'s
Annual Report on Form 10-K for the year ended December 31, 1998. We also consent
to the reference to us under the heading "Experts" in such Registration
Statement.

/s/ PRICEWATERHOUSECOOPERS LLP
- -----------------------------------
PricewaterhouseCoopers LLP

McLean, Virginia
May 3, 1999