Novavax, Inc. NVAX shares were trading higher Tuesday following the signing of a coronavirus vaccine supply deal.

What Happened: Japanese pharma giant Takeda Pharmaceutical Company Limited TAK announced Monday that Japan's Health Ministry has agreed to purchase 150 million doses of Novavax's vaccine candidate manufactured by it in Japan.
The agreement is contingent on licensing and approval.

Takeda and Novavax have previously announced an agreement for the former to establish the capability to manufacture NVX-CoV2373, known as TAK-019, at its facilities in Japan. The Japanese company expects to begin distribution of the vaccine candidate in early calendar year 2022.

Novavax is licensing and transferring manufacturing technologies to enable Takeda to manufacture the vaccine antigen and is supplying the Matrix-M adjuvant to Takeda for fill/finish together with the antigen.

Takeda, meanwhile, is responsible for the Japanese clinical trial and regulatory submission to the Pharmaceuticals and Medical Devices Agency and will distribute TAK-019 in Japan should it be approved by Japan's Health Ministry.

Why It's Important: It has been a long wait for Novavax as it is striving to push its vaccine candidate past the finish line. The company announced in late February that it has begun submissions for a rolling review of NVX-CoV2373 by multiple global regulators.

The company has yet to obtain the greenlight from the FDA despite reporting in mid-June promising safety and efficacy data from the U.S. and Mexico legs of its late-stage clinical trials.

A regulatory nod in Japan could kickstart a string of approvals in the rest of the region.

Incidentally, Takeda is also the distribution partner of a rival vaccine from Moderna, Inc. MRNA. Recently, a few lots of Moderna's vaccine distributed in Japan were found to becontaminated, resulting in the suspension of 2.6 billion doses of the shot.

At last check, Novavax shares were rising 7% to $269.10 and Takeda was up 0.21 at $17.