With more than 6 million confirmed Covid-19 cases worldwide and the number increasing daily, the race for a Covid-19 vaccine is moving at full speed, asserts Sel Hardy, equity analyst at CFRA Research's flagship newsletter, The Outlook.
Globally, there are more than 100 vaccines under development — with nine of them in human clinical trials already. We expect the development efforts to intensify in the coming weeks and expect more companies entering the clinical trial Phase I, where the vaccine is tested in a small sample of healthy humans with moderate doses.
We also anticipate more companies advancing to Clinical Trial Phase II, where a larger sample of subjects of different age groups are tested for safety, efficiency, and determining the right dosing, and move to Clinical Phase III rapidly, where more complex and rigorous tests are performed on a much broader population.
The goal of the vaccine is to create antibodies against the disease so that once a person encounters the infection, the immune system knows how to respond. Based on Mayo Clinic and various scientific sources, the Covid-19 virus (SARS-CoV-2) has a spiked protein on its surface (S Protein), which can quickly attack a human cell through respiratory droplets produced by an infected person.
A vaccine would prevent the S protein from attaching itself to human cells and stop the virus. Nine pharmaceutical companies so far are in Phase I Clinical Trials — and two of them in Phase II — but we expect the competition to increase. (See table, below.)
While most companies are focusing on the traditional vaccines by introducing small or inactive forms of the virus to stimulate the immune system, Pfizer (PFE), in a collaboration with BionTech (BNTX) and separately, Moderna (MRNA), are focusing on a messenger-Ribonucleic acid (mRNA) vaccine, a novel technology, where an information carrying biomolecule instructs body cells to make copies of the S protein of the virus, recognize it and build antibodies to fight it once it attacks the body.
The main advantage of an mRNA vaccine is its quicker development timeline as the vaccine can be delivered with lower dosing requirements and can be produced in larger quantities rapidly. Moderna, the first to release Phase I Clinical data, got off to an early lead but experienced recent setbacks.
The company has developed nine different vaccines in various stages of development in its nearly 10-year history, where it focused on mRNA technology. Moderna announced it had positive results from its Phase I clinical trial for a COVID-19 vaccine on May 12th and seemed to be leading the race.
The company was approved to proceed with a Phase II clinical trial after eight patients in a Phase I safety trial developed antibodies for the virus after two doses of mRNA- 1273, the vaccine that the biotech company is developing with the National Institute of Allergy and Infectious Diseases.
Moderna suffered a setback, however, when reports indicated that trial participants experienced adverse reactions to mRNA-1273. On this news and as AstraZeneca (AZN) also entered Phase II, MRNA’s share price fell.
Although Moderna has taken an early lead, two pharmaceutical companies in our coverage, Johnson & Johnson (JNJ) and Pfizer (PFE), are well positioned in the race, in our view. Both companies are working on a potential vaccine, have leading candidates, and are deploying massive resources for R&D and manufacturing to produce hundreds of millions of doses. JNJ is entering into strategic collaborations and investing massively to provide an affordable vaccine on a massive scale.
Since late January, JNJ’s Janssen unit has been working to develop a preventive vaccine against SARSCoV- 2, which JNJ estimates could be ready in early 2021. Since February, the company entered several smart collaborations in our view, with Biomedical Advanced Research and Development Authority (BARDA), Beth Israel Deaconess Medical Center (BIDMC), and Emergent BioSolutions, Inc. (EBS) to fortify its position in the race.
JNJ also has ambitious manufacturing goals of rapidly supplying more than a billion doses of vaccine. To reach this goal, the company announced that it will enter strategic collaborations in the U.S. and abroad to support its manufacturing capabilities.
Pfizer's collaboration with BionTech, the German biotech company, to jointly develop an mRNA-based vaccine is promising. The joint effort aims to develop the vaccine in Europe and the U.S. in the initial stages and increase manufacturing capabilities to address the large global demand that will arise. Pfizer is conducting clinical studies in Germany with Biontech following the approval of its Phase I/II trials by German authorities.
The collaboration aims at using Biontech’s R&D efforts on multiple mRNA vaccine candidates, while Pfizer aims to contribute with its existing R&D capabilities and assist in regulatory, manufacturing, and distribution issues through its worldwide presence. Pfizer increased its R&D budget for 2020 by $500M for Covid-19 research, which is now expected to be in the $8.6 billion to $9 billion range for 2020.
Merck (MRK), although not part of the nine companies conducting clinical trials yet, is engaged in research efforts for both the development of medicines and a vaccine for Covid-19. MRK announced research collaborations in recent months with the Institute for Systems Biology and the non-profit scientific research organization IAVI to define the molecular mechanisms of Covid-19 and work on Covid-19 vaccine development efforts, respectively.
Through the collaboration with IAVI, Merck aims to jointly develop a vaccine candidate using the virus technology that is the basis of its Ebola Zaire vaccine. The Biomedical Advanced Research and Development Authority also committed to provide funding for the research development efforts.
On May 26, MRK announced the acquisition of the Austrian vaccine developer, Themis, for an undisclosed cash amount. The acquisition will enable MRK to access Themis’ broad pipeline of vaccine candidates and immunotherapies.
