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1 Thing Investors Should Watch That Could Disrupt the COVID Vaccine Market

By Keith Speights and Brian Orelli, PhD - Jun 30, 2021 at 7:01AM

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The major vaccine makers are definitely watching it.

COVID-19 vaccines appear to be working remarkably overall so far. And some companies have already made billions of dollars in sales with the market continuing to expand. In this Motley Fool Live video recorded on June 16, Motley Fool contributors Keith Speights and Brian Orelli discuss one key thing that investors should watch that could disrupt the COVID-19 vaccine market.

Keith Speights: All right. Brian, let's take a look at the big picture here with COVID-19. In the United States, we've had remarkable success. Things seem to be going pretty well across the country with a lot of Americans receiving COVID vaccinations, but the rate of vaccinations has slowed significantly just in recent days and over the last few weeks. Nearly one-third of Americans remain hesitant about receiving the vaccine according to the latest surveys.

The Delta variant that was first identified in India is now in the United States. It appears to be more contagious and more serious than other variants. Some experts are even warning that COVID-19 cases could increase again in the United States.

What do you think all of this means for the U.S. COVID vaccine market, particularly with Pfizer (PFE -0.72%), Moderna (MRNA 3.27%), Johnson & Johnson (JNJ 0.48%), and potentially Novavax (NVAX 2.00%)?

Brian Orelli: I think the one thing investors really should be keeping their eyes on is breakthrough infections. These are infections of people who had previously been vaccinated and the three things you want to look at are which variants are causing it, and then obviously which vaccines the patients got are the ones that are going to be inferior for certain variants, and then most importantly is whether they are hospitalized.

If there's the hospitalizations go up and people that are vaccinated, people are going to be a lot more interested in getting the booster shots which is obviously going to drive sales in the future years ahead.

I think if people are getting sick but they're not getting hospitalized, then it's going to be a lot closer to the flu, or people who generally don't like getting sick are going to get their annual flu shot, but a lot of people don't bother to get their annual flu shot because the likelihood of them dying from the flu is fairly low.

Speights: Yeah. You hit on what I'm watching most closely. I'm not especially concerned, but I do think that this could potentially the scenario that some of these experts are predicting anyway. That scenario could mean that we will get booster doses sooner rather than later and perhaps more frequently than annually even.

It's possible that booster doses will be required on a more frequent basis than on an annual basis. It remains to be seen. But at least the data that I've seen thus far is that if you get two doses of the Pfizer shot or the Moderna shot that you're fairly well protected against even the Delta variant, although the efficacy is lower versus the original coronavirus strain.

Orelli: Yeah. But again, I think it also goes back to how severe is the disease going to be once you're getting the breakthrough infection, are you just having flu-like symptoms or are you actually having to go to the hospital. If not very many people are having to go to the hospital, then I think that lowers the likelihood.

The other issue here is we just don't know how long the protection is going to last, because even the earliest vaccines that people haven't had it for that long. So we don't know how long the protection is going to last.

Speights: Yeah. It's going to probably be, I would say, sometime early fall before we know. At least we'll know if protection has been provided for at least a year because that's when some of the earliest participants in clinical studies will have gone 12 months. We will see.

Brian Orelli, PhD owns shares of Novavax. Keith Speights owns shares of Pfizer. The Motley Fool recommends Johnson & Johnson and Moderna Inc. The Motley Fool has a disclosure policy.

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Stocks Mentioned

Pfizer Inc. Stock Quote
Pfizer Inc.
PFE
$49.75 (-0.72%) $0.36
Johnson & Johnson Stock Quote
Johnson & Johnson
JNJ
$166.09 (0.48%) $0.79
Novavax, Inc. Stock Quote
Novavax, Inc.
NVAX
$42.30 (2.00%) $0.83
Moderna, Inc. Stock Quote
Moderna, Inc.
MRNA
$176.78 (3.27%) $5.60

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