After Monday’s breakthrough announcement by Pfizer, the 90% effective vaccine is dominating stock market news, but you must keep an eye out for other vaccines in the race. Pfizer’s vaccine doesn’t mean the game is over as pharma corps continue to compete to produce an effective vaccine suitable for distribution.
Stocks have rallied after Pfizer’s press release earlier this week with the CEO cashing out 60% of his own shares, worth $5.6M, the same day as the announcement. While some stocks have boomed including the S&P 500 and the Dow Jones Industrial Average, many have dropped. Those companies which are not going to benefit from the vaccine include Zoom, Citrix Systems and others that have been thriving during the pandemic. Other top winners include Rolls-Royce who hugely support aerospace and Cineworld as hopes raise that cinemas will reopen sooner than thought.
A Pfizer vaccine by 2021 would be a game changer for investors with reflation trade thunder the microscope. However, there is a lot of room for setbacks as Pfizer is yet to release exact data from their clinical trials and only have preliminary safety results. Furthermore, coronavirus will inevitably mutate and there is no certainty as to how quickly Pfizer’s mRNA vaccines can be adjusted accordingly.
For much of 2020 biotech has performed well in stock markets as there is an increased demand from the higher rate of illness worldwide. The front runners from now on will depend on if other vaccine producers can match the rate of efficacy of Pfizer. But overall pharmaceutical companies should continue to thrive. Especially with the split Senate and House which will protect biotech in the US and a Biden win pledged to boost support for healthcare in the US, which will likely float pharma corps.
Why do we need more than one vaccine?
There are several different types of vaccines with various rates of effectiveness. Each type is better suited to different population groups, winners will have better success in those vulnerable to coronavirus like the elderly or BAME groups. Therefore health ministers won’t be settling for the first vaccine out there. There is speculation on whether the Pfizer vaccine is safe and effective in elderly groups as the details of who the vaccine has been previously tested is yet to be announced.
Thankfully the type of vaccine Pfizer have developed is prime for easier and efficient distribution. Pfizer’s vaccine uses mRNA technology which is faster, cheaper and safer than other types of vaccine.
Who else is in the race?
Other pharma crops are said to be very close to producing other types of vaccines against coronavirus. Runner-up pharma’s include AstraZeneca, Johnson & Johnson, 0.02%, Inovio Pharmaceuticals, -9.22%, Novavax, 9.41% and Sorrento Therapeutics, 13.16%. Pfizer’s results have shadowed other vaccines being developed which will lead to a lower demand for other COVID19 treatment avenues.
Moderna is up 4.52% as people clock on that their work to develop an mRNA vaccine is proven possible. Moderna’s mRNA vaccine works in a similar way to trigger antibodies as the Pfizer vaccine and is likely to have positive results that are due to be announced on 22nd November. The validation of mRNA technology boosts confidence in all of Moderna’s projects with stocks projected to increase long-term.
CureVac, another company developing an mRNA vaccine, saw stocks rise 5% on Monday as hopes were raised for other successful vaccines. Although CureVac’s vaccine has produced promising results, they have only completed a Phase 1 trial so there is a long road ahead.
Other Covid vaccine candidates who don’t use mRNA technology including Johnson & Johnson, Novavax and GlaxoSmithKline stocks gained 3% on Monday with Astrazeneca up 2.4%. Though if their hard work will prove fruitful is another question.
While all attention is on Pfizer, other pharmaceutical companies shouldn’t be forgotten. Keep up to date with the latest news with BullBear.