As the world eagerly awaits the results for the drug, there is one more long-awaited event: a breakthrough in the coronavirus vaccine.
Positive news of an approved vaccine for SARS-CoV-2, the virus behind the pandemic, could make a big difference not only to everyday life worldwide, but to many stocks.
We've tackled some of the and (ETFs) that are suitable for those looking to bet on biopharmaceutical stocks.
Below we take a look at companies leading the race for the vaccine and an ETF to help investors gain broader exposure:
Companies Nearing the Finish Line
Worldwide, there are more than 46 million confirmed COVID-19 cases.
The World Health Organization (WHO) publishes updates on global scientific work on a possible cure for the new coronavirus. Three of the biopharma companies that have caught the attention of that list in recent weeks include Pfizer (NYSE :), BioNTech (NASDAQ 🙂 and Moderna (NASDAQ :).
In an open letter dated October 16, Pfizer CEO, Dr. Albert Bourla, Three major issues in the development of a successful vaccine:
Clinical issues (effectiveness and safety);
Regulatory issues (is the vaccine approved by national regulatory agencies, such as the FDA);
Commercial issues (successful production and distribution opportunities).
Pfizer and Germany-based partner BioNTech are about to receive efficacy results from the late phase of the vaccine trial. According to Dr. Bourla:
"Based on positive data, Pfizer will file for emergency use in the US shortly after the safety milestone is reached in the third week of November."
BioNTech went into detail on its manufacturing plans, saying, "If legal authorization or approval is obtained, [we] expects to produce up to 100 million doses by the end of 2020 and possibly more than 1.3 billion doses by the end of 2021." "
Moderna also shared some promising updates when it released Q3 Financial Oct. 29, saying it recently "completed the enrollment of 30,000 participants for the Phase 3 COVE study of mRNA-1273, its COVID-19 vaccine candidate."
In the third quarter report, management said:
"We are actively preparing for the launch of mRNA-1273 and we have signed a number of supply agreements with governments around the world."
The scientific community, as well as investors, await further updates, each affecting relevant stock prices. Since the beginning of the year, MRNA shares are up more than 240%.
Investing in the industry through an ETF provides exposure to the benefits of vaccine development without having to keep up with the rapid scientific development of any company.
Here's one to consider:
ETFMG Treatments, Tests, and Advances ETF
Current Price: $ 27.10
52 Week Range: $ 23.80 – $ 35.15
Yield: 1.42%
Expense Ratio: 0.68%
The ETFMG Treatments, Tests and Advancements ETF (NYSE 🙂 consists of biopharmaceutical companies developing vaccines or other therapies, as well as diagnostic technology against infectious diseases.
The fund began trading in June 2020. While most investors would understandably consider COVID-19 the primary focus, there are more than 20 anti-disease countries with epidemic diseases.
So the work of these companies or other newcomers will not end, even if there is a vaccine against the new coronavirus soon. According to a report by MarketsandMarkets, "the global vaccination market is expected to reach $ 58.4 billion by 2024, up from $ 41.7 billion in 2019, at a CAGR of 7.0% during the forecast period."
GERM, which has 63 companies, tracks the Index for Initial Treatments, Testing and Progress. The top ten companies make up about 45% of the fund's net worth of more than $ 50 million.
BioNTech, Moderna, diagnostic test manufacturer Quidel (NASDAQ :), drug treatment developer Hercules (NYSE :), life science research and clinical diagnostics company Bio-Rad Laboratories (NYSE :), and diagnostic information services provider Quest Diagnostics (NYSE:) top the list of companies.
Shares of other companies working on a COVID-19 cure are also included in GERM. CureVac (NASDAQ :), Gilead (NASDAQ :), Ibio (NYSE :), Inovio Pharmaceuticals (NASDAQ :), Merck (NYSE :), Novavax (NASDAQ :), Regeneron Pharmaceuticals (NASDAQ :), Sanofi (NASDAQ :), and Sorrento Therapeutics (NASDAQ 🙂 are some such companies, among others.
Since inception, the fund is up more than 7%, reaching a high of $ 35.15 on July 20. GERM's short-term fortunes are likely to ebb and flow with headlines about vaccine news, especially about the final stages of clinical trials and potential. approvals by national authorities
Bottom Line
A successful vaccine in the coming weeks could significantly impact the global economy and boost hopes for 2021. Biotech ETFs, in particular, can benefit from a successful vaccine.
Those market participants who are considering devoting some of their investment capital to biopharma in the hope that a vaccine will be available soon can also research the following ETFs:
SPDR® S&P Biotech ETF (NYSE 🙂
VanEck Vectors Biotech ETF (NASDAQ 🙂
Virtus LifeSci Biotech Clinical Trials ETF (NYSE 🙂
