(Reuters) - The U.S. government has agreed to buy 1.5 million more doses of Novavax (NASDAQ:NVAX) Inc COVID-19 vaccine, the company said on Monday, adding that the modified agreement includes funds for development of an updated vaccine by fall this year.
Sales of the company's vaccine have been hurt by a global supply glut and waning demand, with Novavax cutting its full-year revenue forecast for the shots twice last year.
The protein-based vaccine was expected to convince those skpetical of the new mRNA-based vaccines against the virus from rivals such as Pfizer Inc (NYSE:PFE) and Moderna (NASDAQ:MRNA).
The deal comes even as the United States plans to end its COVID-19 emergency declarations on May 11, nearly three years after it imposed sweeping measures to curb the spread of the pandemic.
Novavax did not provide financial details of the contract.
The U.S. Food and Drug Administration is also in the process of simplifying its COVID-19 vaccine policy as it considers whether to recommend that Americans get an annual booster shot for the virus.
Shares of the vaccine maker rose 3.2% before the bell on Monday after the Wall Street Journal first reported the news.