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Fauci and the use of remdesivir against covid-19 1:47
(CNN Business) - US stocks rose on Wednesday on optimism about an experimental drug that could help the world fight the coronavirus pandemic.
The Dow soared more than 600 points, or 2.6%, in hopes of making progress in the health crisis that has killed more than 50,000 people and crushed the American economy.
Wall Street peaked from the session in the early afternoon after Dr. Anthony Fauci, the nation's leading infectious disease expert, expressed optimism about remdesivir, the experimental drug from Gilead Sciences (GILD).
Speaking at the White House, Fauci said a study by the National Institute of Allergy and Infectious Diseases (NIAID) showed that remdesivir had a "clear, significant, and positive effect in reducing the recovery time" of the coronavirus. .
- LOOK: Covid-19 in the US: remdesivir, a drug that promises against covid-19
"What has been shown is that the drug can block this virus," Fauci told White House journalists.
The rebound began after Gilead said early Wednesday that he is "aware of the positive data" from the NIAID and understands that the treatment "met its key objective," the main outcome measured to determine whether a treatment was successful.
Investors applauded the news because there are currently no FDA-approved treatments to treat coronavirus. The Dow rose 600 points, or 2.6%. Nasdaq increased 3.5%. Gilead was up 4% on Wednesday and is now up 27% so far this year.
Scott Gottlieb, a former FDA commissioner, told CNN Business that Gilead treatment is an "important start" in the fight against the coronavirus.
"This medication does not appear to be a home run, but it may benefit some patients when used properly," Gottlieb said in an email. "We will get better medications, but this is a start to our ability to more effectively attack this virus."
Health restrictions imposed to combat the pandemic have caused the loss of millions of jobs and have led the US economy to contract during the first quarter for the first time since 2014.
Without control group
In addition to the positive news about the NIAID study, Gilead announced front-line results from its own Phase 3 trial evaluating remdesivir administered to critically ill hospitalized patients with coronavirus. The company said the study showed that patients who received a 10-day treatment with the drug "achieved a similar improvement in clinical condition" compared to those who took a five-day treatment. This suggests that the shorter regimen may be sufficient.
This is how remdesivir worked in a patient with covid-19 1:24Gilead further stated that "no new safety signs were identified" in any of the treatment groups. The company plans to send the full data for publication in the coming weeks.
However, it is crucial to note that, unlike the NIAID study, the Gilead-administered trial does not have a control group, where some patients do not get the drug being tested. That means it will be difficult to say if the treatment is really helping or if the patients could have improved on their own.
This is not the first time that remdesivir has triggered a major rally on Wall Street. US stocks soared on April 17 in a report that gave positive data for the Gilead drug. However, analysts warned at the time that remdesivir will not be a silver bullet in the fight against the coronavirus.
That's partly because remidesvir is a potential treatment, not a vaccine that could prevent the disease from spreading to people in the first place.
However, there was also positive news on the vaccine front. A German company working with Pfizer started human trials of a possible coronavirus vaccine that could be supplied to millions by the end of the year.
"Hopefully we get more good news from Gilead and other pharmaceutical companies about therapies that could increase people's confidence to re-engage with companies again," wrote Peter Boockvar, chief investment officer at Bleakley Advisory Group, in a note to clients. .
Will Remdesivir get FDA approval?
The news from Gilead was a bit surprising, because last week the company acknowledged that it ended an early trial of remdesivir in China and had no conclusive findings about its effectiveness in treating the coronavirus. That development drove global stocks lower.
“My confidence increased today. Little by little it has been rising [with each signal] that this drug really works, ”said SunTrust analyst Robyn Karnauskas.
Gottlieb, the former FDA commissioner, added that he believes there is enough data for the FDA to make the drug more widely available under an emergency use authorization.
- MORE: What is remdesivir, the medicine that could help covid-19 patients?
Given the current crisis, Karnauskas agreed that the FDA could be more open to approving remdesivir for emergency use even though all the information is not yet available.
"I don't think normal rules apply during a pandemic," said Karnauskas. "[But] the FDA has to be comfortable that the drug is safe."
Medication may not move needle for Gilead
Even if remdesivir is shown to be effective against coronvirus, there is no guarantee that it is a great moneymaker for Gilead. This is partly because there are many unknowns, including how long the pandemic will last, when the drug will be approved, and how much it will cost, if at all.
"We have no idea about any of these things," Karnauskas said.
- MORE: The medical trial of the antiviral remdesivir, to treat the coronavirus, was not "conclusive," says the company that makes the drug.
Still, SunTrust conducted an analysis assuming that remdesivir is the only treatment and is used to treat 250,000 patients a year, at a cost of $ 10,000 for a 10-day treatment. Even then, SunTrust noted that Gilead's fair value will only be $ 82 a share, or roughly where the shares are trading now.
"The action could exceed its mark because there is emotion," Karnauskas said.
coronavirusremdesivir