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How Will FDA Approval of COVID Vaccines in Younger Kids Impact Pfizer?

By Keith Speights and Brian Orelli, PhD – Nov 5, 2021 at 6:33AM

Key Points

  • Pfizer convinced the FDA that its COVID-19 vaccine was safe and effective for younger kids.
  • FDA authorization for the younger age group won't increase Pfizer's sales over the near term.

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Not as much as you might expect.

Children ages 5 through 11 will now be able to receive the COVID-19 vaccine developed by Pfizer (PFE 0.03%) and BioNTech (BNTX -1.14%). In this Motley Fool Live video recorded on Oct. 27, 2021, Motley Fool contributors Keith Speights and Brian Orelli discuss how U.S. Food and Drug Administration (FDA) authorization of the vaccine in younger kids will impact Pfizer.

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Keith Speights: Brian, let's jump right on in, and obviously the big story in COVID-19 is that the FDA advisory committee met yesterday, reviewed data for the Pfizer-BioNTech COVID-19 vaccine in children ages five through 11.

There was a big decision from this committee, Brian. What did these outside experts conclude?

Brian Orelli: There was apparently some tense deliberation about exactly who should get the vaccine because kids aren't likely to die from getting COVID-19. But there are real side effects specifically, myocarditis is probably the biggest concern.

The question is, should the average kid get it or should only kids with some underlying condition who are more likely to die if they get substantially sick or maybe live with elderly people who they don't want to pass it onto the elderly people? That sort of kid. The question was, do you give it to everybody or do you give it to some people?

Ultimately, I think the panel basically said, well, that's not really our job, our job is just to say whether it should be given emergencies authorization and the panel decided unanimously on that the vaccine should be given Emergency Use Authorization for that age group of five to 11. There was 17 yeses, with zero nos with one abstention.

It seems like the FDA will take the committee's advice since the analysis that the agency presented to the committee concluded that the reduction in COVID hospitalizations and deaths outweighed the risks of the side effects only when they set the parameters of the infection rates really, really low, does the side effects end up being worse than whatever the number of hospitalizations and deaths you would've reduced from COVID-19.

The interesting thing will be to see if the CDC committee will recommend it for either all kids or just kids with underlying conditions, that's the committee the doctors will be listening to figure out exactly in this age group which kids should actually be getting the vaccine.

Speights: Brian, would you care to make a prediction on what the CDC committee might decide?

Orelli: I don't know. It's a real toss-up and the problem is this ever-changing issues with the infection rates. Right now, I think they probably will recommend it for everyone, but I could see them changing that recommendation fairly soon if infection rates go down even lower than they are right now.

Speights: Now Brian, I think this is a good assumption, but let's assume that the FDA goes along with its advisory committee's recommendation. Let's assume the CDC is in lockstep with it. How does this impact Pfizer?

Orelli: I mean, it probably doesn't really affect Pfizer and BioNTech's sales all that much because they've already sold the vaccine to the United States and so the United States has enough vaccine, I believe to vaccinate all the kids, 5 through 11 if all the kids wanted to. I think that it's not going to affect the sales that much.

In theory, if those aren't getting used, then they would presumably get donated and then those are lost sales for Pfizer and BioNTech in developing countries. But the sales price in the developing countries is a lot less and so therefore the profit on the vaccine are a lot lower and so I don't think they're losing that much whether these vaccines get used on kids in the United States or on adults in developing countries.

Speights: If anyone was wondering, Pfizer stock and I think BioNTech stock as well actually dipped a little bit this morning, and the reason why is exactly what you were just saying, Brian. I mean, this good news probably won't have much of a financial impact on either company, at least over the short term.

Keith Speights owns shares of Pfizer. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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