On November 16th, 2020 Moderna, who has never had a drug or vaccine go to market, has announced efficacy data on the COVID-19 vaccine they have been developing. Moderna stock has risen by 21.4% since this announcement to be valued at $109.18 and is up more than 400% year-to-date. Moderna has said that its experimental coronavirus vaccine was 94.5% effective at protecting people from Covid-19, the second vaccine to hit a key milestone in U.S. testing. Even more importantly, the vaccine showed positive signs of being safe. However, Moderna must wait for more-complete safety data before being widely distributed. Moderna said it plans to ask the FDA by early December to clear the vaccine for distribution.
On November 8th, a vaccine developed by Pfizer Inc. and partner BioNTech showed in an early analysis to be more than 90% effective, with final safety data concluding to be 95% effective. Pfizer and BioNTech SE saw significant excitement surrounding their stock that has mostly subsided in the days after Moderna announced their vaccine. Pfizer saw a modest 6% change after their first announcement to put them at $38 per share where they have held steady since early November. BioNTech saw gains of nearly 20% to $112 following the announcement, which then immediately pulled back following the Moderna announcement to $89 per share. Following the duo’s second announcement BioNTech has regained momentum and has stayed consistently around $105 per share.
Astrazeneca and Johnson & Johnson, both of which are a part of our portfolio have also seen sliding stock prices in response to Moderna’s efficacy despite developing their own vaccine (down 5.6% and 3.2% respectively). Both of these trials have experienced complications that have sidelined the trials for a brief period of time.
So what makes these vaccines so different? In traditional vaccines, the patient is administered a weakened or inactivated virus which then triggers an immune response. These antibodies then remain in the body and can identify and help neutralize future infections. Both Moderna and Pfizer have been developing an mRNA vaccine to degenerate an immune response. It works by delivering genetic instructions that teach human cells to make a protein resembling one found on the surface of the coronavirus. The mRNA codes for the coronavirus spike protein, which then allows antibodies to produce an immune response. The benefit of this treatment is that it is safe and very efficacious. For reference, in recent years the influenza vaccine was only 40-60% effective among the overall population. To fasttrack the vaccine production, safety trials are occurring in parallel fashion, rather than sequentially. This means that Phase I and Phase II trials are occurring simultaneously to create the vaccines as quickly, and safely as possible.
The high efficacy data should mean that these RNA vaccines should significantly reduce the burden of hospitalization from Covid-19, which are quickly nearing capacity. This bodes well for Moderna and Pfizer stock. Operation Warpspeed, the federal government’s vaccination initiative, has already committed $2.5 billion to Moderna to buy 100 million doses of the vaccine, with the option to produce 400 million more. Currently, Moderna is working with contract manufacturers to boost production. The advantage of the Moderna vaccine over the Pfizer vaccine is that it only needs to be kept slightly below freezing while it storage, and has a shelf life in refrigeration for about 7 days, while the Pfizer vaccine must be kept below -80 celsius and can only be refrigerated for 5 days.
Because of the urgent need, the FDA plans to clear Covid-19 vaccines more quickly than is standard in a public health emergency. Technically, the authorization would be for emergency use, rather than a standard approval. If both vaccinations get approval by the FDA, about 40 million Americans can be vaccinated by December 2020.
Written by Collin Kruczek, PharmD Candidate 2024, University of Pittsburgh School of Pharmacy