Since 2020 began, a race against the clock has been launched to see which pharmaceutical laboratory is capable of developing vaccines that slow down the coronavirus pandemic or drugs that reduce its mortality.
The world's largest pharmaceutical companies, such as Novartis , Roche , Pfizer, Astrazeneca, Johnson & Johnson, are fighting with Chinese firms or with new biotech companies, such as Gilead, to curb the disease and reduce confinement times.
The ability to produce effective tests that detect who has Covid-19 has also become critical.
In China, CanSino Biologic s is working with the military to develop the vaccine, and they are already in the second phase of clinical trials. The shares of this company have multiplied their value almost three times so far this year.
At the Shanghai Stock Exchange, firms such as Jiangsu Wuzhong Industrial or Shandong Lukang Pharma have also shot up in the year.
1. Gilead: the company of the moment quoted expensive
Gilead is one of the world's great biotech companies. With a capitalization of close to $ 100 billion, it was largely unknown to the general public until the outbreak of the coronavirus pandemic. The good results obtained by its drug Remdesivir have made Gilead jump to the headlines and its price has gone from $ 65 at the beginning of the year to hitting highs at $ 83 (+ 30%).
"We have added Gilead Science to our portfolio since we think it is one of the best positioned within the sector and that it is likely to get a coronavirus vaccine," they explain from the firm Metagestión. Since its founding in 1987, Gilead has become a benchmark in the development of antiretroviral drugs to treat patients infected with HIV, hepatitis B, or the flu. It has more than 11,000 employees.
"The point is that Gilead has now appreciated too quickly, and we don't know if it will live up to expectations," says Juan Martínez, from Abante Biotech.
On Friday, the company's shares soared 8% after a report was released that one of its drugs is being very effective in patients with coronavirus. The tests are still very preliminary.
2. Abbott: a laboratory that seduces experts
Stefan Blum is a fund manager at Bellevue AM, a prestigious Swiss boutique. For a decade, he has held the reins of a medical technology fund. The first position in its portfolio is the American laboratory Abbott. “We have the legal maximum allowed invested in this firm, 9.9%. It is a good example of all the virtues of the health services and technologies sector, for its capacity for innovation, for operating in resilient markets, for its wide diversification and for its solid balance ”, he explains.
Abbott has been negatively affected by the coronavirus, especially in its sales of detection of cardiac pathologies. However, the firm has been able to develop a test to detect Covid-19. "I am convinced that the group will emerge stronger from the coronavirus crisis," says the expert.
The US company has a market capitalization of $ 170 billion, after having appreciated by 10%. It has 107,000 employees and in 2019 billed $ 32 billion.
Of the 23 analysts who monitor the evolution of the firm, 18 recommend buying. After the latest increases, Abbott would be very close to its target price, set at an average of $ 98 per share.
3. Roche: new test for Covid-19 antibodies
Swiss pharmaceutical company Roche announced on Friday that it has developed an antibody test for Covid-19 that it estimates will be able to start selling early next month. This advance will add another of the diagnostic tools that experts see as key to lifting social distancing measures around the world.
The Basel-based company explained that it will be available in May in countries that accept European regulations and that, shortly, it will receive authorization to use the tests in the United States.
The firm's shares soared nearly 2% on Friday, and are already trading above year-earlier levels.
Roche is one of the world's pharmaceutical giants. In 2019 it invoiced 57,300 million euros (+ 8%) and achieved a profit of 13,146 million euros (+ 33%). The group holds the patent on drugs such as the anti-anxiety Valium, the antiviral Tamiflu and the anti-acne Roaccutane.
Of the 28 analysts who follow this value, 20 recommend increasing positions. The average target price is 325 Swiss francs, giving it a potential revaluation of 6.5% over the price of recent days.
4. Translate Bio: in search of an effective cure thanks to genes
This company specializing in gene expression, the process by which DNA information is translated into orders for cells to make the essential proteins for life, is also developing its own treatment for the virus. Using his experience with messenger RNA, the key element in gene expression, and collaborating with the French firm Sanofi, he intends to create his own anti-Covid-19 vaccine candidate.
"Unlike how traditional vaccines are made [to put parts of the virus into the body to generate antibodies], this one generates antibodies more quickly and efficiently," explain Abante Biotech, a firm that has taken a strategic position in Translate Bio ( see interview on next page).
All in all, Translate Bio is a small company that, in addition, has been dragging profitability problems. At the end of 2019, the company's revenue was $ 7.8 million, while expenses rose to $ 123.57 million. Total losses amounted to 115.76 million, representing an increase of $ 11.53 million compared to the previous year. Despite strong swings in the price of its shares, so far in 2020 the titles of Translate Bio have increased by 23%.
5. Akers Biosciences: the firm that shot up 344% in two sessions
Akers Biosciences is proof of what investment madness can bring about when a company announces a breakthrough on the road to the Covid-19 vaccine. In just two sessions, his shares soared 344%. Specifically, Akers revealed that, together with Premas Biotech, he managed to successfully clone all the coronavirus antigens that were selected as candidates for the creation of a vaccine. Antigens are a substance that triggers the formation of specific antibodies and are key in generating a possible immune response.
As detailed in its latest annual report, Akers is a microenterprise in which economic losses are a constant. “We have recorded net losses in most of the years since our creation. In 2019 they were $ 3.88 million and $ 10.84 million in 2018. As of December 31, 2019, Akers' accumulated deficit amounted to $ 119.58 million. The company's revenue fell 5% in 2019 to $ 1.57 million, ”they explain.
Regarding the future success of his vaccine project, Akers warned in his 2019 results that "there is no guarantee that the Federal Food and Drug Administration will approve any of our projects." However, this year already accumulates a rise of 30%.
6. Sanofi: possible vaccine by mid-2021
With 100,000 employees in more than 100 countries and a capitalization of € 104 billion, France's Sanofi is one of the titans in the race for a vaccine. In its war against the pandemic, it has teamed up with other firms. Sanofi produces hydroxychloroquine, an antiviral used against malaria that, according to some limited independent clinical studies, could be effective in reducing the viral load of Covid-19. Sanofi recalls on its website that its medicine has not been indicated as an alternative to fight the virus by any country and that, today, there is not enough clinical evidence to draw any conclusions.
Beyond this drug, Sanofi is working on the development of a vaccine with the help of other organizations, such as the previously mentioned Translate Bio or the British giant GSK.
As announced by Sanofi and GSK, both firms hope that their collaboration will allow the development required for the availability of the vaccine to be completed by the second half of 2021. They warn that this would be achieved in the event that clinical trials go well and obtain approval. good of the authorities. Since January, its shares have fallen 8% on the Paris Stock Exchange.
7. Pfizer: attacking the Covid-19 from different angles
Pfizer is another of the giants in the pharmaceutical industry. Its market capitalization amounts to almost $ 200 billion. The American company has announced advances in different fields against Covid-19. On the one hand, it has developed a compound that in preliminary tests is effective as an antiviral against this disease. After the results, the company announced that it will start preclinical trials and that by the third quarter of this year it expects to start clinical studies.
When it comes to a vaccine, Pfizer recently teamed up with Germany's BioNTech. "The collaboration aims to rapidly advance the development and human testing of multiple candidates for a Covid-19 vaccine with the goal of globally providing an effective vaccine if successful," they explained in a joint statement.
Under the terms of the agreement, Pfizer will pay BioNTech $ 185 million in advance, of which 72 are in cash and 113 are delivered via entry into the German company. "BioNTech has the potential to receive future achievement payments of up to $ 563 million," said Pfizer. So far this year, the American's shares have fallen 8%.
8. Novacyt: a clear stock market winner of the pandemic
Novacyt is also a small company that has been catapulted into the Stock Market by the Covid-19 crisis. Its shares, which started 2020 at a value of 0.17 euros, are currently at 4.9 euros each, after a revaluation of 2,782%. Novacyt's spectacular escalation began on January 31, when the company announced the launch of a molecular test to diagnose the coronavirus. "The coronavirus test has the ability to exclusively detect the branch of the 2019 virus, which, in our view, makes it unique compared to other tests that are less specific and can give false positives," said the listed company at the time. .
On April 8, the World Health Organization rated the test created by Novacyt as suitable. The company indicated that the WHO has approved its use for a year, "unless circumstances dictate otherwise." Two days earlier, Novacyt already obtained the go-ahead from the National Reference Center for Respiratory Infection Viruses at the Pasteur Institute, the leading biomedical research institution in France. According to Novacyt, its test is stable at room temperature, which eliminates the need to maintain the cold chain and facilitates its transport and, therefore, its export.
9. Grifols: anticoronavirus plasma for already cured patients
The Spanish listed company seeks to fight Covid-19 using its knowledge and following a different path than other companies that focus on the development of vaccines or antivirals. His idea is to use the blood plasma of patients who have overcome the disease to provide antibodies to those who are still going through it.
The blood product company signed an agreement in late March with various US institutions and federal public health agencies in the United States, including the FDA, the health authority of that country. The objective: to promote the development of this treatment route.
Grifols hopes to start producing the so-called hyperimmune immunoglobulin thanks to the plasma he receives from donors in the United States by July. However, the company stressed that everything will depend on the rhythms set by the FDA.
In Spain, Grifols is working on a clinical trial with methylene blue-inactivated plasma from recovered patients, collaborating with certain donation centers and public hospitals due to the impossibility of establishing their own plasma donation centers. So far this year, Grifols is down 4% on the Ibex.