Who's ready for another viral outbreak? During the week ended May 21, the World Health Organization (WHO) said it had found about 120 cases of confirmed or suspected monkeypox, a dangerous viral infection related to smallpox.

Monkeypox is endemic to central and west African countries, but the WHO keeps finding it in around a dozen countries where we aren't used to seeing monkeypox. Since many of the new cases aren't associated with travel to monkeypox hot spots, it's highly likely that it's already spreading through communities. This means we could see a flood of new cases emerging in the weeks ahead.

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The U.S. stopped mass vaccinations for smallpox around 50 years ago, so hardly anyone has any natural immunity to monkeypox. The danger isn't limited to zookeepers and men in yellow hats, either. Monkeypox got its name because it was first discovered circulating among a group of research monkeys, but it mainly spreads from person to person.

As we've already seen with COVID, timely vaccine development can lead to enormous cash flows. This year Pfizer expects Comirnaty sales to reach around $32 billion.

Emergent Biosolutions (EBS -0.80%)Chimerix (CMRX 203.03%), and SIGA Technologies (SIGA 0.94%) all have successful poxvirus programs of their own. Investors with monkeypox on their minds have already started pushing up their stock prices.

Emergent Biosolutions

This stock rose in early 2021 when it was awarded enormous contracts to manufacture COVID-19 vaccine doses for AstraZeneca and Johnson & Johnson. The bottom quickly fell out from under Emergent Biosolutions when a failed U.S. Food and Drug Administration (FDA) inspection uncovered J&J doses that were contaminated with ingredients intended for AstraZeneca's vaccine.

When it isn't busy botching COVID vaccines for clients, Emergent Biosolutions develops other vaccines and treatments that are aimed at some of the most terrifying pathogens of all time. One of its vaccines is ACAM2000, the only single-dose smallpox vaccine licensed by the FDA. The vaccine contains an active, but relatively innocuous virus related to smallpox.

With just a handful of cases confirmed in the U.S., it's highly unlikely that we'll see a mass distribution of ACAM2000. If monkeypox case counts continue climbing, though, health officials could quickly decide ACAM2000 is worth the risk of side effects.

Chimerix

Last June, the FDA approved Tembexa, this company's antiviral treatment for smallpox. The biotech stock recently imploded after the company agreed to sell Tembexa to Emergent Biosolutions for $225 million up front, milestone payments that could reach $100 million, and a royalty percentage of future sales.

Chimerix's deal with Emergent didn't please investors because the company also noted these terms could be adjusted based on the actual amount of Tembexa sold. Chimerix investors were also unhappy about the company's pivot to oncology drug development.

Last year, Chimerix acquired a cancer drug developer called Oncoceutics to access an experimental treatment for brain cancer in late-stage development called ONC201. It turns out that ONC201 isn't as far along the development pathway as hoped. Chimerix stock also tanked because the company admitted it will have to run a long and expensive phase 3 trial before submitting an application to the FDA.   

This biotech already developed one FDA-approved treatment but it's important to remember there weren't any smallpox patients available to run a typical clinical trial. This means we really have no idea if Tembexa is an effective treatment for monkeypox. Increasing expenses from ONC201 plus highly uncertain cash flows from Tembexa make this a stock to avoid for now.

SIGA Technologies 

If there's a larger monkeypox outbreak, Tembexa will compete with Tpoxx. This is SIGA Technologies' antiviral treatment for smallpox. On May 19, the FDA approved an intravenous version of Tpoxx to be administered to patients who can't swallow oral capsules of Tpoxx. Shares of the stock climbed in response.

Shares of SIGA Technologies rose more sharply than Chimerix because, in Europe, Tpoxx is already approved to treat monkeypox in addition to smallpox. In the U.S., the FDA has approved Tpoxx and Tembexa to treat smallpox but the agency still hasn't weighed in on either for the treatment of monkeypox.

According to SIGA Technologies, Tpoxx has already been used to treat cases of monkeypox. The company also said EU member states where cases have been found are already beating a path to its door.