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On Sunday, U.S health officials declared a public health emergency after confirming 20 domestic cases of the swine flu disease. Eighty people have died from this disease in Mexico and over 1,300 additional Mexican people have been infected with it. American health officials are deeply concerned as some infected Americans with the virus have matching samples of the same virus that has struck in Mexico.

Late Friday, shares of Novavax (NASDAQ:NVAX) surged 75% with it being one of the few publicly-traded biotechnology firms focused on developing vaccines for infectious diseases. Up until Friday, shares in NVAX had been languishing at 52 week lows with the biotech sector being one of the few groups to not have participated in the recent market rally.

Noted biotech research firm Rodman and Renshaw initiated coverage on NVAX with an Outperform rating and a $4 price target on April 2. According to R&R analyst Elemer Piros, Novavax’s virus-like particle (VLP) vaccine development platform stands ready to improve the method by which viral vaccines are manufactured. Current processes are outdated and inefficient, while NVAX’s VLP technology can produce 10-20 times higher yields.

Recently, Novavax forged a strategic partnership with Cadila Pharmaceuticals, one of the largest privately held pharmaceutical companies in India. Not only did NVAX receive an $11 million cash infusion from this joint venture, it also validated its technology platform. The deal also allows NVAX to utilize Cadila’s world-class research, clinical development, and manufacturing expertise and infrastructure to support development of current and future vaccine candidates.

NVAX’s CEO has already offered its support to the U.S. Centers for Disease Control and Prevention and apparently is working on contacting the Ministry of Health in Mexico to offer any help it can. CEO Dr. Rahul Singhvi has stated that his company can produce a vaccine from an emergent strain of the flu virus in 12 weeks. This is in stark contrast to Biocryst (NASDAQ:BCRX), a company whose shares also moved higher on Friday but is only in clinical trials right now for its drugs that block key enzymes in viral diseases.

In the short term, look for NVAX’s shares to continue moving higher. If the stock can clear significant resistance at $2.40, you will see momentum players move into the name and most likely push it toward 52-week highs as investors look to a name that may play a role in solving this serious health issue.

Disclosure: The author has no position in NVAX.

Source: Novavax: Swine Flu Vaccine Maker's Shares Surge