6 Biotech/Drug Stocks Up Manifold in 2020 Thanks to COVID-19

SARS-CoV-2 is believed to have caused the deadliest pandemic in the past century. The coronavirus has infected more than 76 million people and caused more than 1.7 million deaths worldwide as of December 24, according to the World Health Organization website. Stock markets around the world rebounded significantly on the coronavirus news in March, wiping out billions of dollars of investors' money.
However, we have seen steady rebound in most stock market indices around the world, and many of them are trading above their pre-crash highest levels. The strong rebound in stock markets around the world has been fueled by progress in coronavirus vaccine development. The availability of vaccines is expected to accelerate the normalization of the global economy. Several stocks have seen multiple gains.
Basically, economies around the world have not reached the levels seen in the pre-COVID-19 era. Some sectors like airlines and restaurants have been hardest hit due to the pandemic and are still under pressure. Several companies in the pharmaceutical / biotech sector have also felt the heat intermittently in clinical trials, which resulted in delays in reading data or in trials being abandoned. The sale of drugs administered by doctors has been hampered due to government bans in various countries. However, some biotech stocks have more than doubled over this period, particularly those focused on developing a coronavirus vaccine. We note that two vaccines from Pfizer / BioNTech and Moderna received FDA emergency approval earlier this month, raising hopes for a normal world in a year or two. However, the new strain of coronavirus found in the UK is again a cause for concern.
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Here we discuss six biotech / drug stocks that have done well so far this year, aided by their encouraging strides in developing a coronavirus vaccine.
Novavax NVAX
Novavax's pivotal Phase III trial of its COVID-19 vaccine candidate NVX-CoV2373 in the US and Mexico is expected to begin in the coming weeks. Meanwhile, a Phase III study of NVX-CoV2373 in the UK and the Phase IIb efficacy study in South Africa have completed full registration with more than 20,000 participants who participated in these studies. Interim data from the UK study are expected in the first quarter of 2020.
The candidate showed strong antibody data in Phase I and it is very likely that the efficacy and safety data from the Phase II / III studies will be positive. Novavax is positioned to play a key role in the COVID-19 vaccine space.
The stock is up 3,107.3% so far this year, compared to an increase of 10.2% for the industry.
Vaxart (VXRT)
In a phase I study, Vaxart is developing an oral vaccine against COVID-19 that can be administered as a tablet rather than an injection. The COVID-19 oral vaccine candidate VXA-CoV2-1 can offer tremendous logistical advantages as it can be conveniently distributed and administered without the need for cold chain storage and distribution. Preclinical data on the tablet vaccine have shown that VXA-CoV2-1 activates both systemic and mucosal immunity, a broader immune response compared to injectable vaccines.
The stock is up 1902.8% that year, compared to an increase of 3.7% for the industry.
Inovio Pharmaceuticals INO
The company took part in the race to develop coronavirus vaccines in early March. Although the company's Phase II / III coronavirus vaccine study was suspended due to a partial suspension imposed by the FDA in September, the study has now resumed. The company is developing a DNA vaccine candidate, INO-4800, to fight SARS-CoV-2. Additionally, the US Department of Defense will fund both phases of the study, suggesting that there will be no financial mishap going forward. The company also plans to develop DNA-encoded monoclonal antibody candidates as a potential treatment for COVID-19 with funding from several US federal agencies, including the Department of Defense.
The company's shares are up 205.2% so far this year, compared with an industry growth of 10.2%.
Translate Bio TBIO
The company has a strong partner in Sanofi. Last month the company and its partner announced promising preclinical data on their coronavirus vaccine candidate MRT5500. A phase I / II study is expected to begin in the first quarter of 2021. A positive reading of the study data will drive stock prices up.
Translate Bio's shares are up 196.7% so far this year, compared to an increase of 3.7% for the industry.
Moderna MRNA
The company is one of the early candidates for coronavirus vaccine development. In March, the company began clinical development of its mRNA-based vaccine mRNA-1273. The company's vaccine was the second vaccine to receive FDA emergency approval earlier this month. The vaccine achieved a vaccine efficacy rate of 94.1% during the primary efficacy analysis of the Phase III study evaluating the Candiadte. The vaccine is also being tested for conditional approval in Europe and several other countries. Supply agreements with a value of several million cans also exist with various countries.
Moderna shares are up 566.4% so far this year, compared to an industry growth of 10.2%.
The company, together with its partner Pfizer, brought the world's first approved coronavirus vaccine for emergency use. The mRNA-based vaccine BNT162b2 is now approved for emergency / temporary / conditional use in more than 40 countries including the US, 27 EU member states, the UK and Canada. BioNTech and Pfizer joined the race in late May, but their accelerated development progress has led to a rally in BioNTech stock.
BioNTech's shares are up 195.4% so far this year, compared to the industry's 10.2% growth.
Zack's top 10 stocks for 2021
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