Biotech Sector In Focus As Coronavirus Spreads Panic

The World Health Organization has now declared the outbreak of COVID-19 as a pandemic, given the alarming levels of spread and severity. COVID-19, a new strain of coronavirus, first appeared in late 2019 in China and causes severe pneumonia-like symptoms in infected patients.

Currently, there are no FDA-approved treatments for the same. While big companies like AbbVie (NYSE:ABBV) are working with health authorities to evaluate the efficacy of drugs in hand, developing a cure for this disease has become a race against time. Given the widespread outbreak, the spotlight is particularly on companies which are developing treatments/vaccines for the same. Most of these companies have performed relatively well amid the massive stock selloff globally. While the drugs and vaccines will need some time to be tested and a cure is not imminent, investors will keep an eye on these companies as the pandemic is not likely to die out soon. Notably, smaller biotechs have grabbed the spotlight as they strive to develop treatments to fight this pandemic.

Biotech bigwig Gilead Sciences, Inc. (NASDAQ:GILD) is one such company that is gaining from the coronavirus crisis. The company is a pioneer in antiviral therapies. It has initiated two phase III studies to evaluate the safety and efficacy of remdesivir in adults diagnosed with COVID-19. These randomized, open-label, multicenter studies will enroll approximately 1,000 patients at medical centers, primarily across Asian countries. The studies will assess two dosing durations of the candidate, administered intravenously. The FDA had earlier accepted Gilead’s investigational new drug (IND) filing for remdesivir for the treatment of COVID-19. Reportedly, remdesivir is already being used in the United States for the treatment of the disease under federal rules that allow the use of unapproved drugs on compassionate grounds.

Inovio Pharmaceuticals, Inc. (NASDAQ:INO) is another company which saw its shares surge amid this crisis. Last week, the company announced an accelerated timeline for developing its DNA vaccine, INO-4800, to address COVID-19. The company plans to begin human clinical trials in the United States in April and soon thereafter, in China and South Korea.

Novavax, Inc. (NASDAQ:NVAX) has been awarded an initial funding of $4 million by the Coalition for Epidemic Preparedness Innovations (CEPI) to support its efforts to develop a COVID-19 vaccine. This, in turn, drove the stock. Discussions are ongoing regarding additional funding from CEPI to address Novavax’s costs through the phase I. The company began developing a novel vaccine to protect against COVID-19 in January 2020. Initiation of phase I clinical testing is expected in May or June.

Clinical-stage immunology company, Vir Biotechnology, Inc. (NASDAQ:VIR) , announced a research collaboration agreement with the National Institutes of Health (NIH) and the National Institute of Allergy and Infectious Diseases (NIAID), Vaccine Research Center (VRC), to advance characterization and development of human monoclonal antibodies (mAbs) against coronaviruses, including SARS-CoV-2, the virus that causes COVID-19. Moreover, the company recently signed a letter of intent with biotech bigwig, Biogen Inc. (NASDAQ:BIIB) , for the development and clinical manufacturing of human monoclonal antibodies for the potential treatment of COVID-19.

Moderna (NASDAQ:MRNA) too is evaluating a vaccine for COVID-19. The company has shipped vials of mRNA-1273, its vaccine against the novel coronavirus to the National Institute of Allergy and Infectious Diseases (NIAID), part of the NIH, to be used in the planned phase I study in the United States.

Moderna currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Apart from these, several smaller biotechs like Mesoblast Limited and Can-Fite BioPharma Ltd have jumped the bandwagon.

Meanwhile, not just the biotech sector but also big pharmas like Johnson & Johnson (NYSE:JNJ) and GlaxoSmithKline are making efforts to develop vaccines and treatments to combat this deadly virus.

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