Current talks with a potential partner on its COVID-19 jab could take several months and might not succeed, French drugmaker Valneva warned on Monday, saying it would only produce a second-generation vaccine if it obtains the necessary funding.

The French company has struggled to bring its COVID-19 vaccine to the market and compete with the products of larger rivals like AstraZeneca, Moderna or BioNTech/Pfizer. Its shares have lost almost 80% since peaking at the end of 2021.

Valneva has won regulatory approval in the European Union and some other countries for its first-generation jab, but said it suspended manufacturing in light of low order levels.

It said it would only invest in building up production capacities for a second-generation vaccine - adjusted to mutations of the virus - if it found a partner willing to finance the move.

"The company is in active discussions with a prospective partner for potentially funding the development of a second-generation COVID-19 vaccine," said Valneva.

"These ongoing discussions may continue for several months and may not lead to an agreement," added Valneva.

Valneva chief executive Thomas Lingelbach also said the company would provide future updates "if and when" it reaches a deal. (Reporting by Tassilo Hummel; Editing by Sudip Kar-Gupta)