The Wuhan coronavirus epidemic has been a real downer for industries with customers in China or supply chains that run through it. Nobody knows just how serious this public health emergency will become, but we can be sure the pharmaceutical industry will receive more attention than usual.
There are hundreds of drugmakers and diagnostics companies making noise about their coronavirus projects, and it isn't always easy to separate signals worth listening to from all the noise. If you want to focus on the pharma industry's members most likely to impact the spread of 2019-nCoV infection, though, here are three good places to start.
|Company (Symbol)||Potential Coronavirus Product||12-Month R&D Budget|
|Gilead Sciences (NASDAQ:GILD)||Antiviral treatment||$9.2 billion|
|Moderna (NASDAQ:MRNA)||Vaccination||$529 million|
|Roche (OTC:RHHBY)||Screening||$12.8 billion|
1. Gilead Sciences: Potential antiviral treatment
In the U.S., a patient with worsening symptoms of a confirmed 2019-nCoV infection has been treated with an experimental antiviral from Gilead Sciences called remdesivir. Gilead's experimental antiviral appeared effective based on a throat swab that tested negative for the virus just a few days after receiving the infusion.
It's important to understand that Gilead is developing remdesivir to combat the Ebola virus, not 2019-nCoV. Success from a single patient is great news, but there are still a lot of important ins and outs left to consider here.
To produce some evidence of efficacy governments can use to make public health decisions, Gilead is working with Chinese authorities to begin a controlled, randomized study. No matter how hard they step on the gas, though, it will take months to produce the necessary data.
2. Moderna: Vaccine development
While Gilead works on a potential treatment for 2019-nCoV, a much younger company is developing a vaccine to prevent the coronavirus from spreading in the first place.
Although Moderna doesn't have many accomplishments to date, the Coalition for Epidemic Preparedness Innovations has agreed to fund the manufacturing of a 2019-nCoV vaccine that uses the company's proprietary messenger RNA (mRNA) platform. In a nutshell, Moderna's vaccine should instruct a healthy patient's cells to produce proteins that serve as wanted posters that help the immune system recognize infected cells.
Moderna's potential 2019-nCoV vaccine presents an elegant solution to a difficult problem, but there are still a lot of unanswered questions. Moderna has a handful of experimental vaccines that employ mRNA to help immune systems identify dangerous infections, but the company doesn't have any data from a controlled randomized trial that proves any of its mRNA vaccines actually protect patients from infection. Moderna's most advanced vaccine candidate, mRNA-1647, is aimed at cytomegalovirus (CMV), and the company still hasn't shown clear evidence it can prevent CMV from spreading.
3. Roche: Rapid screening
Global pharmaceutical and diagnostics giant Roche has already developed a test that can tell whether or not someone has a 2019-nCoV infection within a couple of hours. Roche's coronavirus test hasn't been approved for marketing yet, but the need for screening is serious enough to take the risk.
A relatively fast 2019-nCoV diagnostic will help prevent infected patients who aren't presenting obvious symptoms from spreading the virus to their healthy families and coworkers. Unfortunately, emergency border closures have made it hard to deliver all the equipment needed to use Roche's coronavirus assays.
Overwhelmed Chinese hospitals and other countries preparing for a surge of demand for coronavirus screening could end up buying a lot of expensive equipment from Roche, but this boost will hardly show up on the company's income statements. Roche recorded $63.8 billion in top-line revenue last year, $13.4 billion of which came from the diagnostics segment.
Moderna's mRNA platform seems like a brilliant way to develop effective new vaccines, but it's probably best to temper your enthusiasm until we've seen some brilliant trial data from a randomized study with a control group. Unless coronavirus vaccine developers intentionally expose a large group of healthy people to the potentially fatal infection, testing for efficacy will require tracking a large group of patients throughout an entire cold and flu season. In other words, it will be more than a year before we know if Moderna can produce a 2019-nCoV vaccine worth manufacturing.
In 2018, a remarkable clinical trial conducted during an Ebola virus outbreak tested Gilead's remdesivir against three other experimental antivirals. In a nutshell, remdesivir's future as an Ebola virus treatment doesn't look great.
There's a chance Gilead's antiviral could find a home as a treatment for 2019-nCoV because coronaviruses behave much differently than Ebola and the rest of the filovirus family. It's probably best to wait for more evidence before getting too excited.