Novavax (NVAX) shares are soaring 5.14% in intraday trading following the announcement that its COVID-19 vaccine, Nuvaxovid®, has received regulatory approval in Japan. This development has triggered a milestone payment from Takeda Pharmaceutical, boosting investor confidence in the company's financial prospects.

The approval in Japan applies to Nuvaxovid® as an initial immunization for individuals aged six years and older, and as a booster for those aged 12 and above. The vaccine, which targets the SARS-CoV-2 Omicron LP.8.1 variant, offers a protein-based, non-mRNA option in the Japanese market, potentially expanding Novavax's reach in the region.

Under the terms of their collaboration agreement, Novavax is set to receive not only the milestone payment but also royalties on net sales from Takeda during this vaccination season. While specific payment amounts remain confidential due to contractual agreements, investors appear optimistic about the potential revenue stream this approval could generate for Novavax. The company stated that a portion of the milestone payment can be credited towards future royalty payments, suggesting a structured financial arrangement that could benefit Novavax in the long term.