Let’s agree: When it comes to figuring out which biopharma will crack the novel coronavirus vaccine code, no Rosetta Stone will help investors gain the elusive inside track. Yet as I’ve recently written, documents from unassailable sources including the New England Journal of Medicine and National Geographic offer clues. So when it comes to iBio (NYSEAMERICAN:IBIO) and its IBIO stock, a close look at authorities outside Wall Street is in order.
To that end, Amy McKeever’s recent article in National Geographic lists ten companies decisively in the hunt for a Covid-19 vaccine and it’s detailed right down to describing the medical delivery methods of each. (And no, I don’t mean truck or ecommerce van.)
Those making the list include Johnson & Johnson (NYSE:JNJ), Novavax (NASDAQ:NVAX) and the University of Oxford. Ibio does not, which by no means equals a penalty. In fact, IBIO stock catapulted close to 2,500% between January and mid-July, a sign of tremendous investor confidence.
But given that this 12-year-old Delaware-based company ranks as a long shot by virtue of its small size — especially against burly big pharmas and an academic Adonis — yours truly needs to dig deeper to find signs of vitality in the vaccine scene. And I want badly to cheer on these underdogs, what with a crew of just four employees. In contrast, JNJ has 132,000.
IBIO Stock on the Ropes
With the political and public health urgency ratcheting considerably in the last month, it’s time for Ibio to show its stuff. If it has the stuff, that is. Let’s retreat to the investment lab to gauge how this company is faring.
At the end of August, IBIO stock hit a skid from which it hasn’t recovered. Granted, today’s price of $1.82 per share still marks a 508% win for the year. But since Aug. 12, there’s been no upward movement whatsoever; in fact, shares are off 25% from that date. That puts it in the Valley of the Shadow of the Penny Stock, not exactly reassuring when you consider that iBio doesn’t turn a profit.
What do the analysts say? Given this company’s minuscule size, rankings are hard to find. But one firm does label IBIO stock a buy with a median price target of $3.10, which would mark a 64% increase. And it could well happen. The search for a vaccine is far from over and as National Geographic points out, the fastest-ever time for bringing a vaccine to market, for the mumps, “required four years in the 1960s.”
Slow Progress on the Vaccine Front
When was the last time Ibio had good news to share on its vaccine progress? On Sept. 16, the trade publication BioSpace reported that Ibio had developed a decoy molecule as a therapeutic for Covid-19. Trust me, you don’t want me to get into the nuts and bolts of how it works, unless you relish phrases such as, “[This] immunoadhesin targets coronavirus virions directly using the ACE2 extracellular domain.”
Well, OK then. You play biochemist, I’ll play translator: Suffice to say that this therapeutic acts like an antibody and fools Covid-19 into thinking it’s part of a human cell. It’s not a vaccine in and of itself, though it advances the battle against the virus — perhaps significantly.
Looking to my compadres on the InvestorPlace team, Muslim Farooque wrote earlier this month that “with its vaccine candidates still in pre-clinical stages, IBIO is virtually out of the Covid-19 vaccine race.”
Yes, but…as I’ve already contended, the Covid-19 vaccine timeline as I see it is totally, totally out of whack. In the annals of vaccine history four years is the record; a decade or more is the norm. As much as politicians and the people may wish it otherwise, a mid-2021 target is more reasonable — and to a significant degree wishful thinking, Operation Warp Speed or no.
Keep an Eye Out But From the Sidelines
But if that gives iBio time to catch up, is IBIO stock a smart investment? Here, I agree with Farooque that this is a gamble not worth taking. Essentially, it amounts to the investment equivalent of a Powerball ticket. If you feel so inclined, plunk down a few hundred dollars and resign yourself to the likelihood that you’ll never get it back.
Or maybe I should say, you’ll never get it back on a Covid-19 play. IBIO stock, as is the case with so many mini-pharmas, could rocket on some other breakthrough. There’s promise there, at least in terms of plant-based proteins that mimic those found in human plasma.
Yes, I will continue to root for iBio in its fight to make a huge leap with its Covid-19 efforts. But where my investment dollar is concerned, it’ll be from the sidelines. Pun intended, conclusion injected: In the Covid-19 vaccine sweepstakes for investors, I’m not sure IBIO stock has a shot.
On the date of publication, Lou Carlozo did not have (either directly or indirectly) any positions in the securities mentioned in this article.
