Please ensure Javascript is enabled for purposes of website accessibility

GlaxoSmithKline and Vir Biotechnology Jump in Race to Treat and Prevent COVID-19

By Brian Orelli, PhD - Apr 6, 2020 at 1:16PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The companies are taking multiple approaches to develop treatments and vaccines for the disease caused by the novel coronavirus.

GlaxoSmithKline (GSK 2.20%) and Vir Biotechnology (VIR -4.06%) are collaborating to develop multiple drugs and vaccines to treat and prevent COVID-19, the disease caused by the new coronavirus. The news drove shares of Vir up 30% at 1:39 ET on Monday, substantially higher than the 5% or so that the broader markets are up. GlaxoSmithKline, which is substantially larger and won't benefit as much from the potential new products, is up just 2%.

The collaboration will take several approaches to develop the drugs. The most advanced are two antibodies, VIR-7831 and VIR-7832, developed by Vir to treat severe acute respiratory syndrome (SARS), which is also caused by a coronavirus. The antibodies were developed from a patient who recovered from SARS. The companies plan to start a phase 2 clinical trial within the next three to five months.

Masked doctor listening to the heart of a patient in a face mask

Image source: Getty Images.

Further down the line, Vir and GlaxoSmithKine are using Vir's CRISPR screening technology to identify proteins that the coronavirus uses to infect cells. The companies could then develop drugs that target those proteins to block the viral infection.

GlaxoSmthKline and Vir also plan to combine GSK's vaccine technologies with Vir's expertise in identifying viral proteins that are most likely to produce antibodies that will react to an entire viral family. The companies hope to develop a vaccine that would protect patients not only from the coronavirus that causes COVID-19 but also other future coronaviruses.

The companies didn't disclose financial terms of the deal, but they did note that GlaxoSmithKline is making a $250 million investment in Vir at a share price of $37.73.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

GSK Stock Quote
GSK
GSK
$43.69 (2.20%) $0.94
Vir Biotechnology, Inc. Stock Quote
Vir Biotechnology, Inc.
VIR
$24.84 (-4.06%) $-1.05

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
336%
 
S&P 500 Returns
115%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 06/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.