What happens when a biopharma company responds to a pandemic with a well thought out, scientifically sound plan to address it immediately?
That company’s stock soars while the rest of the top players in biopharma are losing a whopping 7.9% in combined market value due to COVID-19.
At least, that’s what happened in the first quarter for Gilead Sciences and Regeneron, which saw their market caps grow 14.5% and 32.5%, respectively. In fact, they were two of just seven companies among the top 20 pharma players by market cap that charted gains as the COVID-19 pandemic swept across the globe. The aggregate market cap of the top 20 players dropped to $2.6 trillion, according to a new report from GlobalData.
Regeneron’s gain isn’t entirely surprising, given how early it jumped in with an ambitious plan to tackle COVID-19. In mid-March, Regeneron announced it had isolated antibodies from mouse models and human survivors of COVID-19 that could neutralize the virus. Now, it’s preparing an antibody cocktail for a summer clinical trial.
But that wasn’t Regeneron’s only strategy for combating the pandemic. It was simultaneously working with longtime partner Sanofi to repurpose their shared IL-6 inhibitor Kevzara as a COVID-19 treatment. By the end of March, Kevzara was being tested in two pivotal coronavirus clinical trials.
Gilead has also garnered kudos for hustling its experimental treatment remdesivir into clinical trials—and into hospitals for use on a compassionate basis in patients fighting COVID-19. Earlier this month, Gilead CEO Daniel O’Day said the company had slashed the manufacturing timeline for the drug and ramped up production so it could churn out 1 million remdesivir treatment courses by the end of the year.
Roche, which is testing its rheumatoid arthritis drug Actemra in COVID-19, had a 3.6% gain in market value in the first quarter. The drug was already performing well: Actemra sales jumped 30% to CHF 666 million ($687 million) in the first quarter, Roche said yesterday.
But not all of the COVID-19 hopefuls were rewarded by investors in the first quarter. Interestingly, longtime Regeneron partner Sanofi saw its market cap drop nearly 12% despite the fact that it stands to gain if Kevzara succeeds in COVID-19. What’s more, the company recently teamed with GlaxoSmithKline to develop a vaccine against the disease. Still, Sanofi is grappling with other challenges, not the least of which is pressure from Wall Street to freshen up its pipeline even more.
A few other prominent COVID-19 players suffered market-cap losses in the first quarter. They included Pfizer (down 16.5%) and Johnson & Johnson (down 10%). Pfizer is about to launch a COVID-19 vaccine trial with BioNTech, but threats to its core business—like the patent expiration on pain drug Lyrica—caused its revenues to fall 4% last year.
As for J&J, which is also racing to develop a COVID-19 vaccine, it’s the biggest pharma company by revenue and market cap, but it’s also facing its share of challenges. One of its top sellers, Remicade, has been trounced by generic competition, as has its prostate cancer drug Zytiga. J&J’s nagging legal issues—which include opioid trial losses and the ongoing talc lawsuits—haven’t helped soothe investors.
The good news for Big Pharma in the first quarter is that the cumulative 7.9% drop in market cap actually wasn’t as bad as it might seem, GlobalData said. The Dow Jones industrial average, after all, had its worst first-quarter performance ever, losing 23%.
“The reversal of fortune, due to COVID-19, may seem dramatic due to these companies’ long-term growth, however, the effect on the pharmaceutical industry has been mild compared to other industries,” Peter Shapiro, senior director of drugs and business fundamentals for GlobalData, said in the report.
By: Arlene Weintraub
Source: Fierce Pharma
Novo Nordisk has announced that the European Medicines Agency’s (EMA) Committee for Medicinal Products for Human Use (CHMP) has provided a positive opinion for the company’s Sogroya therapy. The once-weekly treatment – also known as somapacitan – is for the replacement of endogenous growth hormone (GH) in aged children three years and older.
Medtronic is set to acquire EOFlow, the South Korea-based maker of an insulin patch pump. In its announcement of the deal Thursday, Medtronic suggested that integrating the tubeless device with its own continuous glucose monitors and meal-detection algorithm could create a new closed-loop system for largely hands-off diabetes management.
Apnimed started the year by bagging nearly $80 million in extended series C funds and the momentum has kept up, with the sleep-apnea-focused biotech nailing its goals in a phase 2 study. “For those who cannot tolerate current treatments, AD109 has the potential to be a convenient, oral pill that could improve people’s quality of life both at night and during the day.”
