Investors looking for stocks that can make dramatic moves in short time frames recently got what they were looking for from Invivyd (IVVD 3.87%). Shares of the clinical-stage biotech stock more than doubled overnight after the company reported successful results from a late-stage clinical trial with an experimental COVID-19 prophylactic.
Is there more fuel in Invivyd's tank that can drive the stock higher?
Why Invivyd Stock jumped
On Dec. 18, Invivyd stock gained more than 150% after the company announced positive data from a phase 3 trial investigating VYD222 for the prevention of COVID-19. In the ongoing study, immunocompromised patients given an infusion of VYD222 produced high levels of serum virus-neutralizing antibodies (sVNA) against the omicron subvariant XBB.1.5.
The stock popped because the sVNA levels among immunocompromised participants were in line with the levels recorded in healthy volunteers in a phase 1 study. Antibody production was also similar to the levels produced by VYD222's predecessor treatment against early strains of the virus.
Image source: Getty Images.
VYD222 was engineered from adintrevimab, a still-experimental antibody that produced positive results in a pivotal study that took place before the omicron variant evolved. However, Adintrevimab's difficulty with neutralizing omicron variants meant the end of its path forward, and decimated Invivyd's stock price back when the company was still called Adagio Therapeutics. With some slight adjustments that help it fight the newer variants, it looks like VYD222 could make it to market.
This June, Invivyd told investors it was in general alignment with the Food and Drug Administration (FDA) regarding a rapid development pathway for VYD222 that piggybacks on data already available for adintrevimab.
Invivyd thinks there are more than 9 million immunocompromised Americans who may not adequately respond to COVID-19 vaccination and could benefit from VYD222. This is a relatively small addressable patient population, but VYD222 wouldn't have to be a blockbuster drug for Invivyd to produce big returns for investors who buy the stock now.
Invivyd's market cap is around $413 million. If VYD222 takes further steps toward commercialization or if it attracts a buyout offer for Invivyd, the stock could soar.
Is Invivyd a good stock to buy now?
Before you throw any of your hard-earned money at Invivyd, understand that this stock is about as risky as they get. Expectations for COVID-related sales are sinking fast. Invivyd would like to use eventual sales of VYD222 to advance treatments aimed at other diseases. For now, though, VYD222 is the only new drug candidate it has in clinical trials.
In January, Pfizer (PFE 0.55%) predicted $21.5 billion in combined sales of its COVID-19 vaccine and antiviral treatment this year and shared expectations for sales in 2024. Since then, the pharma giant has lowered its COVID-19 sales expectations to $12.5 billion this year and just $8 billion in 2024.
While VYD222 could complement Pfizer's lineup, the sinking sales of COVID-19 vaccines and antivirals could make finding a big pharma partner eager to help Invivyd launch it an uphill slog.
Management says it's in alignment with the FDA regarding bridging studies, but just how well aligned is still anybody's guess. The agency will not comment on the accuracy of a drug developer's communications with investors.
Down the road, if we learn that the FDA isn't willing to approve or authorize VYD222 with relatively simple bridging studies, Invivyd stock could crumble. It would probably be best to steer clear of this stock unless you have a sky-high tolerance for risk.
