The clock is ticking and Johnson & Johnson (NYSE:JNJ) is picking up the pace. As of Wednesday morning, the pharmaceutical company is now the fourth to have a novel coronavirus candidate in late-stage human trials. JNJ stock is rallying on the news.
According to a company release, Johnson & Johnson is now enrolling participants for a Phase 3 trial. It will seek 60,000 individuals across 215 locations across the world — including in the United States, Argentina and South Africa. Importantly, the company said it will recruit individuals with and without chronic health conditions.
But why does this all really matter? Johnson & Johnson still is behind in the broader vaccine race.
Investors should first know that Johnson & Johnson occupies an odd space. It has experience, legitimacy and funding. Many likely have accepted that it simply makes sense for JNJ to be a part of Operation Warp Speed, a vaccine accelerator program backed by President Donald Trump. However, Johnson & Johnson has been behind its competitors. AstraZeneca (NYSE:AZN), Pfizer (NYSE:PFE) and Moderna (NASDAQ:MRNA) have already entered late-stage trials.
Despite its slower timeline, there is one key thing about the Johnson & Johnson vaccine that is making JNJ stock pop higher.
JNJ Stock Pops on One-Shot Vaccine
Being first in the coronavirus vaccine race does matter, but so do safety and efficacy. That is likely why many investors are still rewarding JNJ stock today.
Importantly, Johnson & Johnson is pursuing a one-shot vaccine. Just like it sounds, this means that recipients would only need one shot to gain protection. Other vaccine makers — even those leading the Operation Warp Speed program — are targeting multiple doses to trigger the desired immune response.
Why is this important? There is no denying that mass vaccination is a challenge. Countries must figure out how to secure doses, transport them safely and then administer them to an entire population. As we have previously reported, some of these vaccine candidates require special shipping temperatures, making the process even more difficult. If Johnson & Johnson can deliver a safe vaccine that triggers an appropriate, virus-fighting response, its one-shot nature could make it the best bet.
Another thing to note here is that Johnson & Johnson is alone as a producer of a one-shot vaccine. Rival AstraZeneca was initially trying to manufacture a similar product, but backed away when it realized its candidate was more effective with a “booster” shot. If Johnson & Johnson can progress through these late-stage trials and deliver good results, that makes its vaccine candidate even more of a winner.
It will take some time to ramp up its trials, and no vaccine candidate is a sure thing. However, as you watch JNJ stock pop in trading this morning, understand that it represents big potential.
On the date of publication, Sarah Smith did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Sarah Smith is a Web Content Producer for InvestorPlace.com.