WASHINGTON, Oct. 2 (U.S.) – Positive clinical trial results for Merck & Co (MRK.N)’s experimental COVID-19 antiviral pill reverberated in the healthcare sector on Friday, sending the drugmaker’s stock price higher as shares tumbled. the vaccine. Companies and makers of other coronavirus treatments.
Merck shares jumped as much as 12.3% and reached their highest level since February 2020 after data showed the company’s molnupiravir contraceptive pill could halve the chances of death or hospitalization for those most at risk of severe COVID-19 infection. Reuters said experts hailed the news as a potential major advance in the fight against COVID-19.
Meanwhile, shares of vaccine makers such as Moderna Inc (MRNA.O), Pfizer Inc (PFE.N) and partner BioNTech SE were hit, with some analysts saying the promise of an oral drug could be taken at home. Changing public perception of risks associated with COVID-19.
“We see modest headwinds for vaccine stocks like mRNA (Moderna) if the market believes that people will be less afraid of COVID-19 and less inclined to get vaccines, if there is a simple pill that can cure COVID-19,” Jefferies analyst Michael Yee said in a client note. .
Moderna shares fell 13% at midday, while Pfizer, which is developing its own COVID-19 pill, slid 1.3%. US stocks in BioNTech fell 11%.
For Moderna investors, the Merck news presented an opportunity to reap gains after an already impressive run. Shares of Moderna, which was added to the S&P 500 in mid-July, remained up about 220% in 2021 despite Friday’s declines. BioNTech shares were also still up about 200% for the year, even with Friday’s plunge.
Sahak Manuelian, head of equity trading at Wedbush Securities, said the Merck news is “a huge reason for people to take profits off the table” in Moderna and BioNTech shares. “These moves could be exacerbated to the downside given the momentum they had was on the upside.”
Shares of other companies carrying COVID-19 vaccines were also down, with AstraZeneca (AZN.L) down 2% and Novavax (NVAX.O) down 16%.
Companies with other intravenous or injectable COVID-19 treatments also traded, with Regeneron Pharmaceuticals In (REGN.O) down nearly 5% and Gilead Sciences Inc (GILD.O) down nearly 2%. .
The healthcare (.SPXHC) sector was the only one of the 11 S&P 500 sectors in negative territory in midday trading, down 0.5%.
“We see molnopiravir, taken orally as an obvious game-changer that is likely to meaningfully impact not only the treatment model for COVID-19 but also has potential benefit in the prevention setting,” Piper Sandler analyst Christopher Raymond said in a research note.
Merck is conducting a late-stage trial to see if its antiviral pills can prevent COVID-19 infection, in addition to the study showing that it can significantly reduce hospitalization and death in those already infected.
Merck, whose shares last rose about 9%, is leading the race to develop the first oral antiviral drug for COVID-19. Competitors such as Pfizer and Swiss drugmaker Roche Holding AG (ROG.S) with partner Atea Pharmaceuticals Inc (AVIR.O) are conducting late-stage trials of their pills. Shares of Atea rose 19%.
Merck, which has halted its COVID-19 vaccine program, saw its shares drop about 4% for the year through Thursday, before moving into positive territory for 2021 on Friday.
“Merck has kind of died in the water for investors over the past two quarters,” said Kevin Gade, portfolio manager at Bahl & Gaynor, which owns Merck stock. “This shows that their R&D engine is not dead, that they were the first to … in what could be a multi-billion dollar opportunity.”
NS