Pat Benatar's 1980 hit song "Hit Me With Your Best Shot" could have a very different meaning today. People around the world anxiously anticipate a new kind of "best shot" -- a safe and effective COVID-19 vaccine.

There are currently 166 novel coronavirus vaccine candidates in development, according to the World Health Organization (WHO). Twenty-four of those candidates are being evaluated in clinical trials in humans. Most of those are in early-stage clinical studies. However, five COVID-19 vaccine candidates are either currently in late-stage clinical testing or are scheduled to begin a phase 3 study in the next few days.

Sinopharm Group is developing two of the five late-stage candidates, one with Wuhan Institute of
Biological Products and another with Beijing Institute of Biological Products. Another Chinese drugmaker, Sinovac Biotech, also claims a COVID-19 vaccine candidate in phase 3 testing.

AstraZeneca (NYSE:AZN) teamed up with the University of Oxford to develop COVID-19 vaccine candidate AZD1222. WHO chief scientist Soumya Swaminathan stated publicly in June that AZD1222 was "probably the leading candidate."

There's also one COVID-19 vaccine candidate developed by a U.S. biotech that will soon begin phase 3 testing. Moderna (NASDAQ:MRNA) plans to start its late-stage study of mRNA-1273 on July 27.

Which of these five late-stage COVID-19 vaccine candidates is likely to be the biggest winner? It's complicated.

Gloved hand picking one COVID-19 vaccine bottle from a row of bottles

Images source: Getty Images.

Clinical results so far

As you might expect, all five of the COVID-19 vaccine candidates that have made it to phase 3 performed well in previous clinical studies. Unfortunately, there's not a good way to differentiate which experimental vaccine seems to be more safe and effective than others.

Sinopharm and Sinovac reported preliminary results in June from earlier clinical studies. Sinopharm stated that all participants in phase 1/2 studies for its two late-stage vaccine candidates had neutralizing antibodies (which hold the potential for preventing infection by the novel coronavirus). Sinovac said that more than 90% of participants had neutralizing antibodies 14 days after receiving the second injection of its vaccine candidate, CoronaVac. Both Chinese drugmakers also indicated that their respective COVID-19 vaccine candidates didn't cause severe side effects. 

AstraZeneca announced interim results from a phase 1/2 clinical study of AZD1222 last week. Those results, published in medical journal The Lancet, revealed that 91% of participants demonstrated neutralizing antibodies after the first injection of the vaccine candidate. All participants who received a second dose of AZD1222 produced neutralizing antibodies. In addition, the vaccine candidate induced a T-cell response in all participants, which could be key in providing longer-lasting immunity to SARS-CoV-2. AstraZeneca reported that were no severe side effects in patients receiving AZD1222.

Moderna also reported encouraging interim results from a phase 1 study of mRNA-1273 in May and followed up with more detailed data on July 14. Neutralizing antibodies and strong T-cell responses were found in all of the participants receiving two doses of the experimental vaccine. Moderna also said that "mRNA-1273 was generally safe and well-tolerated."

Female scientist holding COVID-19 vaccine bottle

Image source: Getty Images.

Capacity and contracts so far

There are other ways to get an idea of which COVID-19 vaccine candidates might be the biggest winners if they win regulatory approvals. We can evaluate the manufacturing capacity each company has. We can also look at the supply contracts the companies have in hand so far.

Sinopharm expects to be able to produce 200 million doses of its COVID-19 vaccines annually with its manufacturing facilities in Beijing and Wuhan. The company is owned by the Chinese government, so Sinopharm is assured of a large market if its vaccine candidates prove to be safe and effective in late-stage clinical studies.

Sinovac is building a manufacturing facility in China that could make up to 100 million doses of CoronaVac annually. The Chinese government is providing financial backing for this facility. The company hasn't announced any supply deals. However, it seems likely that Sinovac would win contracts in China if CoronaVac wins regulatory approval.

AstraZeneca publicly stated in June that its "total manufacturing capacity currently stands at 2 billion doses." This capacity includes collaborations with external parties to produce AZD1222. And the big pharma company so far has commitments with the U.S., the United Kingdom, and other nations and non-profit organizations to supply more than 2 billion doses of AZD1222 if it wins approval.

Moderna says that it's on track to produce around 500 million doses of mRNA-1273 per year beginning in 2021. But the biotech could boost that number to 1 billion annual doses. Moderna hasn't announced any supply agreements with the U.S. or other countries yet, but those deals will almost certainly be on the way if mRNA-1273 succeeds in late-stage testing.

The best shot?

There's no way to know at this point which COVID-19 vaccines will sail through phase 3 studies and which will run into problems. My view is that any late-stage candidate that proves to be safe and effective will be a big winner. 

However, I think that AstraZeneca probably has the best chances of becoming the biggest winner from a commercial standpoint (assuming AZD1222 secures key regulatory approvals). Why?

The greatest commercial winners will almost certainly be the vaccines that are marketed in the U.S. and major European countries because the price tags will likely be higher in developed nations. China isn't going to pay nearly as much per dose to Sinopharm or SinoVac as AstraZeneca (and Moderna) would be able to charge for their vaccines.

AstraZeneca has more supply commitments lined up and much greater production capacity than Moderna does. In my view, that gives the big drugmaker a significant advantage. Moderna is a lot smaller than AstraZeneca, though. The biotech stock could be the biggest winner for investors if mRNA-1273 performs well in late-stage studies.

Keep in mind that other COVID-19 vaccine candidates could also advance to phase 3 testing in the near future. Some of the companies making these vaccines, especially Pfizer and BioNTech, already have large supply agreements lined up. It's quite possible that the "best shot" of all won't be any of the current late-stage candidates.