You've no doubt heard quite a bit about the coronavirus strain called the delta variant. This variant, first identified in India, is has swept across the world. And it's now the dominant strain in the U.S.
To be sure, there are reasons to be concerned about the delta variant. It's highly transmissible. Scripps Research Institution's Eric Topol called it "a superspreader strain if there ever was one." There's a possibility that the variant could also cause more severe cases of COVID-19.
However, there are also reasons to be cautiously optimistic. Here's what Pfizer (PFE 0.81%), BioNTech (BNTX 0.26%), and Moderna (MRNA 0.77%) are doing to fight the deadly delta variant.
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Pfizer/BioNTech
There was good news and bad news from real-world data released by Israel's Health Ministry earlier this month. First, the good news: The Pfizer-BioNTech vaccine appears to be highly effective in providing protection against severe cases of COVID-19 even with the rise of the delta variant. Now, the bad news: The vaccine's overall efficacy has dropped from 94% to 64%.
The best news of all, though, is that Pfizer and BioNTech have a clear strategy to increase protection against new coronavirus strains, including the delta variant. The partners expect to file for emergency use authorizations (EUAs) in the U.S. and Europe within a matter of weeks for a third booster dose.
Pfizer and BioNTech have already seen encouraging results in a clinical study evaluating a third dose of their vaccine. This data showed that a booster dose given six months after the second dose increased neutralizing antibodies by five to 10 times against the beta variant first identified in South Africa.
There have also been other data published that indicate a third dose could boost neutralizing antibody levels against the delta variant. Pfizer and BioNTech are conducting their own tests to confirm this finding.
The drugmakers think that a third dose of their vaccine could provide high levels of protection against all of the current variants, including the delta variant. However, they also are moving forward with the development of a version of their vaccine that specifically targets the delta variant. Pfizer and BioNTech expect to begin clinical testing of this new version in August pending regulatory approvals.
Moderna
Moderna is already evaluating three different options for tackling new variants. One option is a third dose of the company's vaccine mRNA-1273 that has already won EUAs. Another option is a third dose featuring mRNA-1273.351, which specifically targets two variants of concern -- the Brazilian variant P.1 and the South African beta variant. The third option is a booster dose that combines a 50-50 mix of mRNA-1273 and mRNA-1273.351.
In May, Moderna announcing promising initial results from a phase 2 clinical study that includes all three of these options. A third dose of both mRNA-1273 and mRNA-1273.351 increased neutralizing antibody levels, with the booster dose of mRNA-1273.351 achieving higher neutralizing titers.
However, the company also reported a couple of weeks ago results from lab studies that showed that its vaccine currently on the market produced neutralizing antibodies against all of the variants tested, including the beta and delta variants. Moderna CEO Stephane Bancel said, "These new data are encouraging and reinforce our belief that the Moderna COVID-19 Vaccine should remain protective against newly detected variants."
Still, Moderna believes that booster shots will be needed. It also thinks that the best alternative for these booster shots will be a multivalent variant-specific vaccine. The company's president, Stephen Hoge, said in Moderna's Q1 conference call, "We're committed as a company to make as many updates to the vaccine, to add as many variants as we think are necessary, to ensure that when people receive a booster, it provides the broadest immune protection against the widest range of variants."
Investing implications
The rise of new coronavirus variants is, without question, bad news for the world. New strains make it harder to bring the pandemic to an end. However, the cold, hard truth is that this bad news will probably translate to good news for Pfizer, BioNTech, and Moderna.
The need for booster doses will likely boost the fortunes of these vaccine stocks over the next few years and perhaps beyond then. Any uncertainty about the ability for the companies to generate solid recurring revenue from their COVID-19 vaccines could fall by the wayside with the emergence of the delta variant and other variants of concern.
Other vaccine makers could also achieve more success because of the need for booster doses. The messenger RNA (mRNA) approach used by Pfizer, BioNTech, and Moderna, though, appears to hold a key advantage over rival vaccine approaches with its ability to rapidly develop variant-specific vaccines.
I suspect that these three companies will continue to be the biggest winners in the COVID-19 vaccine market. But the real winner will be the world itself -- by having access to vaccines that are both safe and effective against worrisome new coronavirus strains.
