It was a day late, but the stock market gave thanks on Friday morning with solid gains. As we've seen a lot during 2020, the Nasdaq Composite (^IXIC) led the way higher, rising on hopes that 2021 will bring a full recovery from the yearlong COVID-19 pandemic and the economic devastation that has been seen around the world. As of approximately 11 a.m. EST, the Nasdaq Composite was higher by more than 1%, pushing it further into all-time record territory.
Coronavirus vaccines will be a major contributor to any future return to more normal conditions, both in the economy and everyday life. The stocks that have made the most progress toward vaccines and treatments to fight COVID-19 were among the best performers on Friday, and these five, in particular, helped boost the Nasdaq.
Shares of Sorrento Therapeutics (SRNE.Q -5.42%) rose by 19% Friday morning. The biotech company got good news in the form of initial funding for a project with the Defense Advanced Research Projects Agency.
Sorrento subsidiary SmartPharm Therapeutics will get up to $34 million to go toward a project called "Gene Mabs: A Scalable, Economic, Gene-Encoded Protective Antibody Platform Against Coronavirus." The general idea behind the project is to develop a gene-encoded antibody that could provide rapid protection from coronavirus infection or help treat COVID-19 in patients already infected.
Sorrento already has a facility that can meet initial production demand that meets the requirements for current good manufacturing practices. The company's hope is that an injection into a patient's muscles would help the body produce its own neutralizing antibodies within days.
Sorrento has taken a broad approach toward the COVID-19 challenge, with many different angles at fighting the disease. Even if some fail, the success of others would mean good news for Sorrento and its shareholders.
Novavax and Moderna
Other big gainers in the coronavirus vaccine world were Novavax (NVAX -1.29%) and Moderna (MRNA 1.55%). The two companies didn't have any big news of their own, but both stocks benefited from the misfortunes of a third player in the COVID-19 space.
Less than a week ago, AstraZeneca (AZN -0.34%) announced encouraging preliminary results from its clinical study of a coronavirus vaccine candidate. Working with the University of Oxford, AstraZeneca saw efficacy of up to 90% for certain dosages of its vaccine.
However, in the days since the initial announcement, AstraZeneca has faced increasing scrutiny about the fact that larger dosages of the vaccine produced much lower effectiveness rates. Those who got two full doses only showed a 62% efficacy rate.
Moreover, AstraZeneca said that the company didn't actually intend to test a half-sized initial dose of the vaccine, but rather that it was accidental. The company has therefore said that it will probably go back and conduct another vaccine study to confirm the results.
That's bad news for the general public, but for Moderna and Novavax, it means that their respective vaccine candidates could get a head start as AstraZeneca has to go through a longer development process. With so many companies fighting for the chance to provide vaccines and treatments, these competitive advantages are important financial considerations for shareholders to take into account.
COVID-19 will be the key to the stock market in 2021
Regardless of which companies come up with the best solutions, the world is banking on the end of the coronavirus crisis coming in 2021. Success in the biotech industry in finding good treatment and prevention options will not only help the companies directly involved, but also boost the prospects for nearly every company in the stock market.