That’s why some drug stockpile experts say people shouldn’t bet on winners and losers in vaccines.
But investors should probably not rush these stocks in the hope that one of them will be the first to come up with a successful vaccine.
Vaccines may not be as beneficial to Big Pharma and biotechnology
For Big Phrama companies, the vaccine is unlikely to move the financial needle, so to speak.
Dennis noted that most vaccine manufacturers will end up with government-agreed contracts. So the vaccine is unlikely to be a big generating revenue or profit.
Investors should also be wary of stockpiles of Covid-19 vaccines and treatments, simply because many have already risen to hope and publicity.
Regeneron has grown by more than 60% this year. Moderna and another small biotechnology called Inovio will increase by about 300% in 2020.
“There are a lot of people who aren’t traditional biotech investors who throw money at headlines but don’t do their homework to understand the math of what financial gain will be,” Lonchar added.
He also said that the vaccine is ultimately more important than drugs that can relieve the symptoms of Covid-19.
“We need to have a vaccine. This is our ticket to it. We will not fill football stadiums with 80,000 people until a vaccine is given,” Lonchar said.
But hopes of having at least one (if not more) vaccine ready in the next few months may be too ambitious. Dennis noted that because biotechnology and major pharmaceutical companies are moving so fast to develop a coronavirus vaccine, there are likely to be more failures in clinical trials.
“It’s an aggressive schedule, so it’s a little unsettling. Given these schedules, we’ve never produced a vaccine so fast. So there are risks,” Dennis said.
Cancer treatment is more profitable than Covid-19
Investors need to focus more on other diseases, Loncar said.
“The Gilead deal shows that it is planned for the time after Kovid,” Lonchar said.