What happened

Shares of coronavirus vaccine hopefuls CureVac (CVAC -5.06%)Altimmune (ALT -2.13%), and VBI Vaccines (VBIV 3.40%) each fell more than 15% in September, according to data provided by S&P Global Market Intelligence. That was much worse than the S&P 500, which only lost 3.9% for the month. Shares of recent IPO CureVac were down 15.5% for the month. Altimmune's shares fell a slightly steeper 21.8%, and VBI's shares fared the worst, tumbling 32.9%. 

A girl wearing a mask receives an injection in her arm.

Image source: Getty Images.

So what

The world of small biotech stocks is always volatile, but when those biotechs are working on a coronavirus vaccine, their shares tend to react not only to news about their own vaccine development efforts, but to every piece of news about other companies' coronavirus vaccine development efforts. 

That's why, when industry heavyweight AstraZeneca (AZN -0.25%) announced on Sept. 8 that it had paused the phase 3 clinical trial of its COVID-19 vaccine due to an unexplained illness in one of the participants, shares of all three of the above companies rose. After AstraZeneca announced it was resuming the trial on Sept. 12, that rally ended.

On Sept. 17 and 18, news broke that AstraZeneca, along with another coronavirus vaccine front-runner, Moderna (MRNA -1.39%), were ramping up vaccine production. Shares of CureVac, Altimmune, and VBI declined in response. And just about every coronavirus vaccine stock took a hit on Sept. 22 on reports that the Food and Drug Administration was considering new rules for a COVID-19 vaccine that would delay authorization. 

Meanwhile, none of these three companies released any major news during September. When your success is perceived as depending largely on speed, no news is decidedly not good news. 

Now what

Here's how the three companies compare in terms of their progress on a vaccine:

Company/Vaccine Type Progress Other Noteworthy Products
Altimmune's AdCOVID Single-dose intranasal RBD Pre-clinical trials completed NasoVAX, an intranasal flu vaccine, in phase 2 Trials
CureVac COVID-19 mRNA Phase 2a trial began in September CV7202, a rabies vaccine, in phase 1 trials
VBI's VBI-2901 & VBI-2902 Single-dose eVLP (two candidates) Phase 1 trials to begin by Dec. 31 Successful phase 3 trial of Sci-B-Vac, a hepatitis B vaccine

None of them are considered top-tier contenders to be the first to market with a coronavirus vaccine; top contenders like AstraZeneca and Moderna have already begun phase 3 trials of their vaccines. But each of the vaccines in the chart has some advantages and drawbacks that investors should be aware of.

Single-dose vaccines like Altimmune's and VBI's could be more desirable than standard two-dose vaccines. Additionally, Altimmune's intranasal vaccine could be easier and cheaper to administer than a standard injection. On the other hand, neither company's vaccines have even begun phase 1 trials yet. 

CureVac, a Dutch company, has received funding from the Bill and Melinda Gates Foundation and the German government, but its only other vaccine in clinical trials is a rabies vaccine in early-stage trials, which means if its COVID vaccine isn't viable, there aren't any drugs in development to fall back on. VBI, on the other hand, has a hepatitis B vaccine that's completed phase 3 trials, while Altimmune has several intranasal drugs and therapies in various trial stages. 

Ultimately, investing in any of these biotech stocks is a crapshoot. Only risk-tolerant investors should buy in, and their best bet is to buy multiple companies to increase their chances of hitting the jackpot.