GlaxoSmithKline (GSK 1.60%), Vir Biotechnology (VIR 0.37%), and Eli Lilly (LLY 1.96%) recently reported positive results from a phase 2 study evaluating a combination of Lilly's bamlanivimab with Vir's and Glaxo's VIR-7831 in treating COVID-19. In this Motley Fool Live video, recorded on March 31, 2021, Motley Fool contributors Keith Speights and Brian Orelli examine those results and discuss which of the three stocks is likely to be the biggest winner going forward.
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Keith Speights: Speaking of GlaxoSmithKline...The big drugmaker, along with its much smaller partner, Vir Biotechnology, ticker for Vir is V-I-R, and also along with Eli Lilly, ticker there is LLY, these companies recently reported positive results, I think just earlier this week, from a phase II study that evaluated a combination of the company's drugs in treating mild-to-moderate cases of COVID.
What's your take on those results, Brian, and of these three stocks, GlaxoSmithKline, Eli Lilly, Vir Biotechnology, which do you think is likely to be the biggest winner over the next few years?
Brian Orelli: I like this population that they're treating this mild-to-moderate better than the studies for other antibodies where they've looked at more patients that were more likely to become advanced. If the doctors didn't have to figure out whether they were low-risk or high-risk, that's to the company's advantage, because then the doctors can just basically give it to everybody.
This clinical trial looked at the viral loads, and it reduced persistently high viral loads by 70%, I think that was on day 7. Then they also looked at absolute viral loads, and they were reduced on day 3 and day 5 and day 7. Viral loads are important for spread, but it's a surrogate for sickness, but no one was hospitalized in either arm, so either the people who got the drug or the people who got the placebo. It's hard to know exactly how much is this actually benefiting the companies.
Based on size alone, Vir's obviously the winner here because it's a very small company, and Glaxo and Lilly are giant companies, so this isn't going to benefit them nearly as much. Eli Lilly's antibody is not being used on its own anymore because of the variance, so maybe in theory it benefits a little bit, but Eli Lilly has a second antibody that it's testing in combination with this antibody.
Then part of the issue just is that they haven't done any head-to-head studies of the different antibodies, so it's really hard to know which antibodies or combination antibodies would be most beneficial to patients in the long run. Maybe those studies will eventually come.
Speights: Basically, we're seeing the trade-off between risk and reward here. Obviously, Eli Lilly and GlaxoSmithKline are much larger companies -- they have a lot of products already on the market so they're not going to get as big of a bump, even if all goes well with this combo therapy, but they're also not nearly as risky as Vir Biotechnology. But for that additional risk with Vir, you get the possibilities of much greater returns over the next few years.
