A good vaccine induces herd immunity, which we need to fight the coronavirus pandemic.(1) But we’d better not follow the herd when it comes to investment. We’d better be informed investors. Informed, we’ll understand that a promising vaccine candidate is a promise at best, not a dream realized. We don’t count our chickens before they hatch. 

At this point let’s check out the frontrunners bursting on the scene.(2) By frontrunners I mean those few vaccine candidates tested on humans with reference to the following four phases of clinical development.(3)

𝘗𝘩𝘢𝘴𝘦 𝘐 (𝘱𝘪𝘭𝘰𝘵) 𝘵𝘦𝘴𝘵 𝘰𝘯 𝘢 𝘴𝘮𝘢𝘭𝘭 𝘨𝘳𝘰𝘶𝘱

𝘗𝘩𝘢𝘴𝘦 𝘐𝘐 𝘵𝘦𝘴𝘵 𝘰𝘯 𝘢𝘯 𝘦𝘹𝘱𝘢𝘯𝘥𝘦𝘥 𝘨𝘳𝘰𝘶𝘱 𝘮𝘢𝘵𝘤𝘩𝘪𝘯𝘨 𝘵𝘩𝘦 𝘵𝘢𝘳𝘨𝘦𝘵 𝘱𝘰𝘱𝘶𝘭𝘢𝘵𝘪𝘰𝘯

𝘗𝘩𝘢𝘴𝘦 𝘐𝘐𝘐 𝘵𝘦𝘴𝘵 𝘰𝘯 𝘵𝘩𝘰𝘶𝘴𝘢𝘯𝘥𝘴 𝘰𝘧 𝘱𝘦𝘰𝘱𝘭𝘦 𝘧𝘰𝘳 𝘦𝘧𝘧𝘪𝘤𝘢𝘤𝘺 & 𝘴𝘢𝘧𝘦𝘵𝘺

𝘗𝘩𝘢𝘴𝘦 𝘐𝘝 𝘤𝘰𝘯𝘵𝘪𝘯𝘶𝘢𝘭𝘭𝘺 𝘮𝘰𝘯𝘪𝘵𝘰𝘳𝘪𝘯𝘨 𝘵𝘩𝘦 𝘭𝘪𝘤𝘦𝘯𝘴𝘦𝘥 𝘷𝘢𝘤𝘤𝘪𝘯𝘦 𝘧𝘰𝘳 𝘦𝘧𝘧𝘪𝘤𝘢𝘤𝘺 & 𝘴𝘢𝘧𝘦𝘵𝘺

So, in terms of clinical development, how are the frontrunning biotech firms doing?

𝘼𝙨𝙩𝙧𝙖𝙕𝙚𝙣𝙚𝙘𝙖-𝙊𝙭𝙛𝙤𝙧𝙙 𝙐𝙣𝙞𝙫𝙚𝙧𝙨𝙞𝙩𝙮'𝙨 𝙅𝙚𝙣𝙣𝙖 𝙄𝙣𝙨𝙩𝙞𝙩𝙪𝙩𝙚

Oxford’s ChAdOx1 is a vaccine between Phases II and III.(4) Its prospect has reportedly attracted a huge funding from the US.(5) Indeed the Oxford team head, Professor Sarah Gilbert, has once claimed an 80% chance of success, which is now down to 50%, however.(6)

𝙎𝙖𝙣𝙤𝙛𝙞-𝙍𝙚𝙜𝙚𝙣𝙚𝙧𝙤𝙣

Sanofi’s Kevzara is a Phase III vaccine. Notably it has been tested on critical patients.(7) In other words it will, if successful, lower the fatality rate. Its target population is the Medicare-eligible baby boomers (born during the post-World War II years).

𝙋𝙛𝙞𝙯𝙚𝙧-𝘽𝙞𝙤𝙉𝙏𝙚𝙘𝙝

On May 5, 2020 Pfizer announced that it had its first participants dosed at NYU Grossman School of Medicine and University of Maryland School of Medicine.(8) Entering Phase I, Pfizer doesn’t race like a hare.  But then we should never underestimate a tortoise. That being said, Johnson & Johnson still keeps us waiting for the debut of its Phase I vaccine.

𝙈𝙤𝙙𝙚𝙧𝙣𝙖-𝙉𝙖𝙩𝙞𝙤𝙣𝙖𝙡 𝙄𝙣𝙨𝙩𝙞𝙩𝙪𝙩𝙚𝙨 𝙤𝙛 𝙃𝙚𝙖𝙡𝙩𝙝 (𝙉𝙄𝙃)

Moderna’s mRNA-1273 is a Phase I vaccine enjoying good press, which propelled its stock vertically into the air. Yet, I share some commentators’ doubt about the true magnitude of its initial “success”.(9) Backed by the NIH though, Moderna has stopped short of fully disclosing its test data for no good reason. This arouses my curiosity, to put it nicely.

𝘾𝙖𝙣𝙎𝙞𝙣𝙤 𝘽𝙞𝙤𝙡𝙤𝙜𝙞𝙘𝙨-𝘼𝙘𝙖𝙙𝙚𝙢𝙮 𝙤𝙛 𝙈𝙞𝙡𝙞𝙩𝙖𝙧𝙮 𝙈𝙚𝙙𝙞𝙘𝙖𝙡 𝙎𝙘𝙞𝙚𝙣𝙘𝙚𝙨 /𝙋𝙍𝘾

CanSino Biologics’ Phase I vaccine, codenamed Ad5-nCoV, has been tested on 108 “healthy adults”.(10) A related research paper published in The Lancet (11) ironically highlights two weaknesses of Ad5-nCoV. (A) The use of a common cold virus as an adenoviral vector could have actually confounded the test results, given probable pre-existing immunity among the participants. (B) It follows that the immune responses obtained weren’t necessarily a testimony to the vaccine’s efficacy. To be fair, Oxford’s vaccine is also adenoviral-vectored, but somehow it is strong enough to progress toward Phase III.(12)

Anyway, Tianjin-based CanSino Biologics has done pretty well in the Hong Kong Stock Exchange, once having had the National Research Council of Canada on board.(13) I am not a Canadian. I must therefore pretend that I don’t understand why Mr. Justin Trudeau’s government chose to make it so much easier for the CCP to raise capital overseas.

…

As things stand now, the world is eager to put money in Uncle Sam’s hands, never mind that the yield on the 10-year Treasury note has already dropped below 1%.(14) In the meantime vaccine stocks act like a rising tide that lifts all boats.(15) The market’s message? People worldwide vote for America with their money, and a good chunk of their money is chasing vaccines in America. Needless to say, vaccines hold the key to economic recovery.

——Lingyang Jiang 

Footnotes:

(1)  Herd Immunity: What It Means for COVID-19

(2) Front-Runners Emerge in the Race for a Covid-19 Vaccine | WIRED

(3) Vaccine Testing and Approval Process | CDC

(4) Large-scale human trial of potential coronavirus vaccine kicks off at Oxford - CBS News

(5) https://www.cnbc.com/2020/05/21/coronavirus-us-gives-astrazenena-1-billion-for-oxford-vaccine.html

(6) Project leader: Oxford's COVID-19 vaccine trial has 50% chance of success - Telegraph - Reuters

(7) Our Response to COVID-19 - Sanofi U.S.

(8) COVID-19 Updates | Pfizer

(9) https://www.bloomberg.com/opinion/articles/2020-05-20/moderna-vaccine-whiplash-demands-better-data-disclosure

(10) Chinese military scientists record promising results from coronavirus vaccine trial | South China Morning Post

(11)  Safety, tolerability, and immunogenicity of a recombinant adenovirus type-5 vectored COVID-19 vaccine: a dose-escalation, open-label, non-randomised, first-in-human trial - The Lancet

(12) Adenoviral vectors are the new COVID-19 vaccine front-runners. Can they overcome their checkered past?

(13) Coronavirus vaccine promise makes CanSino stock Hong Kong's hottest of 2020 | Fortune

(14) TMUBMUSD10Y | U.S. 10 Year Treasury Note Overview | MarketWatch

(15) It’s a Good Time to Raise Vaccine Money - Bloomberg