As Black Friday approached, most investors were speculating on what the supply chain crisis would mean for the year’s biggest shopping holiday. By the time shopping began, though, most minds were on another news story. A new Covid-19 variant had been detected in South Africa and it was quickly spreading to Europe. Labeled the omicron variant, this new Covid-19 strain poses a threat to the pandemic recovery story. Perhaps most importantly, we don’t yet know how big that threat is. Scientists have indicated that it will take at least a few weeks for them to assess the effectiveness of vaccines against the new variant, which features multiple mutations. As investors ponder what this means for markets, focus has shifted to one specific question: What does this mean for vaccine stocks?
Investors have expressed concern at what the the emergence of a new variant may mean for markets. It bears noting, though, that such a scenario creates a new opportunity for vaccine stocks, specifically for a new company to pull into the lead.
While Pfizer’s (NYSE:PFE) success in producing a vaccine approved for children has helped it maintain a lead over its competitors, other companies recognize the need for further innovation within the vaccine space. Scientists and researchers have yet to reach a conclusion as to how the new variant will react to current vaccines, but the companies producing them are already working around the clock.
Many vaccine stocks were trending this morning as the omicron variant dominated news coverage. Let’s take a look at what the most prominent vaccine producers are saying and when we can expect to see progress.
- Moderna (NASDAQ:MRNA)
- Pfizer (NYSE:PFE)
- BioNTech (NASDAQ:BNTX)
- Johnson & Johnson (NYSE:JNJ)
- Novavax (NASDAQ:NVAX)
Vaccine Stocks to Watch: Moderna (MRNA)
Moderna was one of the first companies to have its executive team discuss address the omicron variant.
On Sunday, CMO Paul Burton spoke to BBC’s Andrew Marr and said Moderna was hoping to see clinical trials of an omicron-specific booster begin within 60 to 90 days. CEO Stephane Bancel recently spoke to CNBC’s “Squawk Box” on the topic of an omicron- targeting vaccine. While he stated that it will likely take months for the company to develop, produce and ship a vaccine with the ability to target that specific variant, he noted that a booster shot containing a higher 100-microgram dose could be made available much sooner.
Bancel also floated the possibility of administering higher doses of the current vaccines to particularly high-risk patients, such as those in the elderly or immunocompromised categories.
This talk of an effective booster that could take on the new variant has sent MRNA stock shooting up today. As of this writing, vaccine stocks are having a good day and Moderna has risen by more than 10%. Today’s gains have put it up by more than 30% for the past five days.
No pharmaceutical company has received as much positive press for its vaccine innovations as Pfizer. Earlier this month, CEO Albert Bourla was recommended by one InvestorPlace contributor for CEO of the year.
The industry leader also discussed the new variant earlier today, stating that he believed that Pfizer’s Covid-19 pill would prove effective against it. He noted that the treatment method was designed with the thought process that most virus mutations were coming in spikes, exactly what we are seeing so far from the omicron variant. This gives him, he said, a “very high level of confidence” that the oral treatment, Paxlovid, will prove well-suited to help patients with the new Covid-19 strain.
Clinical trials have found that when Paxlovid is taken with HIV drug ritonavir, it reduces hospitalization and death by 89% if taken within three days after symptoms have begun.
While Bourla is still not able to offer much on the effectiveness of the company’s two-dose vaccine against the new variant, he experts it to offer at least some protection. He also said that Pfizer is already at work on a new vaccine and that it produced a DNA template on Friday, speculating that it could be ready within 100 days.
It is worth noting that Pfizer has been able to create vaccines for previous variants in that timeframe but did not end up having to administer them, as the previously distributed vaccines remained effective.
Vaccine Stocks to Watch: BioNTech (BNTX)
Pfizer’s original vaccine partner isn’t missing a beat, either.
The German biotech innovator told Business Insider that it is already at work on the development of an adapted vaccine to combat the omicron variant. According to the company’s spokespeople, the first steps of such a process “overlap with the research necessary” to evaluate the necessity of a new shot. This approach should enable its research team to move forward as quickly as possible.
Like its competitors, BioNTech expects to acquire the data necessary to determine next steps in roughly two weeks, as medical researchers rush to examine new cases. In an attempt to keep the process as efficient as possible, the company is already testing its existing vaccine doses. Like Pfizer, it claims that it will be able to ship out this adapted vaccine within 100 days should it prove necessary.
Like other vaccine stocks, BNTX is having a good day as speculation regarding the vaccine mounts. Shares are up almost 4% as of this writing. Not unlike its competitor Moderna, BioNTech is up almost 20% for the week after seeing a period of mostly flatlining. Earlier this Summer, InvestorPlace analyst Louis Navellier called it a better buy among vaccine stocks than Pfizer.
Johnson & Johnson (JNJ)
Like its competitors, Johnson & Johnson is already at work on ways to combat the new variant. Still waiting on further data, though, the company has stated it “will progress [its new vaccine] into clinical studies if needed.”
Mathai Mammen, global head of research and development at J&J subsidiary Janssen Pharmaceuticals, says that the company remains confident in the “robust humoral and cell-mediated responses” that its original vaccine has elicited in patients to date, giving the company confidence in its ability to adapt its current vaccine to handle the omicron variant.
Mammen added that the company has already begun work on a new vaccine for exactly that purpose and will “rapidly progress into clinical trails” if it is deemed necessary. It has been reported that testing has already begun.
JNJ stock is up 0.3% as of this writing.
Vaccine Stocks to Watch: Novavax (NVAX)
A later player to the vaccine race, Novavax hasn’t had the same success in the U.S. as Pfizer or Moderna.
However, the company recognizes it has a chance to make up the lost ground. In fact, it is already working to develop a vaccine to combat the omicron variant. Novavax has stated that its vaccine will contain the mutated spikes that have experts worried about the variant, thereby enabling recipients to develop necessary immune responses. Its spokespeople have also stated that the testing and developing of the new vaccine will likely take “a few weeks.”
While Novavax has not filed for approval for its initial Covid-19 in the U.S. yet, it received the green light from regulators in both Indonesia and the Philippines.
As InvestorPlace Assistant News Writer Eddie Pan reported this morning, NVAX is a name to watch among vaccine stocks as speculation mounts. While no one is likely to know too much for at least two weeks, companies aren’t wasting any time in building on their vaccine innovations in attempt to pull ahead in the vaccine race. Novavax may not have garnered U.S. authorization yet, but it has risen to prominence by way of its global vaccine distribution work, an edge that earned it a high ranking among second-shot vaccine stocks to buy.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.