Several biotechnology firms are currently locked in a battle to be the first to develop a vaccine for the novel coronavirus. The anticipation surrounding the vaccine has seriously benefited companies like iBio (NYSEMKT:IBIO) and IBIO stock.
For more proof, just look at the price action. IBIO stock has witnessed a whopping 524% growth since last year. The challenge for investors who are looking to cash in on the hype surrounding a Covid-19 vaccine is placing their bets on the right horse.
iBio has been proactive in its approach toward getting a vaccine to the market. It is not only looking at the manufacturing end, but also its ability to scale production at a rapid pace through its proprietary technology called FastPharming.
Hence, this pandemic could prove to be a gamechanger for the company and IBIO stock deserves investor attention at this time.
FastPharming Pushes IBIO Stock Forward
Several biotech firms are working on vaccine candidates to tackle the coronavirus. But the majority of them do not have the ability to scale and accelerate manufacturing. iBio’s FastPharming program appears to be a novelty in the industry, as it should help the company scale the production of its IBIO-200 vaccine candidate.
The company’s FastPharming approach uses a plant-based production system to scale up production with greater consistency and speed. Simply put, it will effectively reduce the initial setup time compared to the traditional manufacturing approaches in the industry.
Therefore, iBio can easily avoid expensive and labor-intensive cell-line development. Moreover, it’s easy to grow more plants when you need them. In other words, it should be much easier — and quicker — to scale manufacturing. Finally, the protein obtained during the research stage remains consistent with the one obtained at the commercial scale.
The company has partnered with Beijing CC-Pharming to test out its vaccine in China and hopes to use its FastPharming system to scale up production rapidly: From Tom Isett, the iBio CEO:
“If our own proprietary SARS-CoV-2 Virus-Like Particle (‘VLP’) program, IBIO-200, results in an approved vaccine, we estimate that we could make about 500 million doses of high-quality product annually at our Texas facility, depending upon the potency we see in the clinic.”
But the Covid 19 vaccine is just one of the many long-term plays in the company’s pipeline. Its lead asset is its IBIO-100 vaccine, designed to help patients suffering from fibrotic diseases. And iBio is also developing a vaccine to combat swine flu. The animal vaccines market is growing at an impressive pace, and the company could become a significant player in the sector. Investors should track the performance of each of these pipeline products — each holds substantial investment potential.
So What Happens Now?
Experts suggest that a Covid-19 vaccine could potentially be worth billions. The vaccine is arguably one of the most sought-after medical breakthroughs in recent memory. The bigwigs in the biopharma space are all in the race to create a vaccine, including Inovio (NASDAQ:INO), Novavax (NASDAQ:NVAX) and Moderna (NASDAQ: MRNA).
These companies have the advantage of having massive research and development budgets. The chart above shows the discrepancies between the top companies in the biopharma sector, including iBio. Moderna has an R&D budget of more than $481 million, which dwarfs its competition. Additionally, the company has sold $1.3 billion in stock to finance its research efforts.
However, companies with relatively smaller R&D budgets, such as iBio, are also gaining traction with investment companies. Recently, Lincoln Park Capital bought 1 million shares of IBIO stock to help finance its research.
The Bottom Line on iBio
IBIO stock is a classic example of taking lemons and making lemonade.
In other words, what has been a catastrophic event for most companies could potentially be a game-changer for iBio. I feel that it has the resources, expertise and leadership to take it past the finish line.
Scalability in manufacturing gives it an edge over its competition, and will greatly impact its attractiveness to potential investors going forward. The company needs to be careful about managing its finances at this time, considering how its free cash flows have been in the negative for the past 10 years.
With that being said, I am bullish on IBIO stock at this time
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University. He does not directly own the securities mentioned above.