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BofA On 3 Coronavirus Vaccine Frontrunners, The Remdesivir Opportunity And Antibodies

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BofA On 3 Coronavirus Vaccine Frontrunners, The Remdesivir Opportunity And Antibodies

The markets are ready for a steady flow of updates from COVID-19 drug and vaccine developers as the world races to contain the pandemic and bring back some semblance of normalcy.

Against this backdrp, BofA Securities issued an update to its view on COVID-19 market opportunities.

Mixed Results From COVID-19 Market: The market remains dynamic but the results have been mixed, analyst Geoff Meacham said in a Friday note. Hydroxycholoroquine and Regeneron Pharmaceuticals Inc's (NASDAQ: REGN) Kevzara faced setbacks, the analyst said. 

The FDA revoked the Emergency Use Authorization for hydroxycholorquine, and a Kevzara study in COVID-19 was stopped by Regeneron following a failed late-stage trial, he said. 

Yet there were meaningful wins, with vaccine and antibody development starting to accelerate, Meacham said.

"We recognize recent datasets have been early and necessarily incomplete — with much still unknown about the virus — resulting in outsized market movements for individual developers and the broader market." 

An antibody is unlikely to arrive before the fall, with any broadly available vaccine to follow by the second half of 2021 at best, the analyst said.

With the ongoing progress, Meacham said he expects continued positive momentum through the summer.

Benzinga is covering every angle of how the coronavirus affects the financial world. For daily updates, sign up for our coronavirus newsletter.

See also: Applied DNA Surges On Encouraging Coronavirus Vaccine Data

The Leading Trio: Pfizer Inc. (NYSE: PFE)/BioNTech SE – ADR (NASDAQ: BNTX), Moderna Inc (NASDAQ: MRNA) and AstraZeneca plc (NYSE: AZN)/University of Oxford are moving to the lead position, the analyst said.

The Phase 1 updates from RNA vaccine producers Moderna and Pfizer/BioNTech are encouraging given that the vaccine candidates lead to the production of neutralizing antibodies at levels equal to or above convalescent serum, he said. 

There is still a long way to go, as real-world protection against symptomatic or severe disease is considered the true test for approval, Meacham said. 

BofA raised its estimates for AstraZeneca/University of Oxford candidate following reports of imminent positive data.

Increased Remdesivir Penetration Likely: Following the hydroxychloroquine disappointment, BofA increased its estimates for the penetration of Gilead Sciences, Inc.'s (NASDAQ: GILD) remdesivir.

BofA lowered its price point and estimates for revenue in 2020 through 2022 to $825 million, $1.5 billion and $2.2 billion, respectively, with rapidly declining sales thereafter, factoring in the emergence of likely more effective antibodies, vaccines and herd immunity.

Next-gen nextgen antivirals like inhaled remdesivir or Ridgeback's ‘2801 are unlikely before next year, according to BofA. 

Antibodies Could Score Over Antivirals: Antibodies are offering a more effective bridge to a widespread vaccine, given their effectiveness in treating other respiratory viruses, Meacham said. 

Eli Lilly And Co (NYSE: LLY) was the first to clinic with its AbCellera-partnered antibody, the analyst said. Regeneron's program, now in Phase 3, could garner more widespread use, he said.

Along with Amgen, Inc. (NASDAQ: AMGN) and Lilly, the analyst estimates a collective peak market opportunity of about $11 billion, eclipsing the antivirals segment starting next year.

Related Link: Moderna Analysts See Positives In Coronavirus Readout As Focus Shifts To Pivotal Phase 3 Study

Latest Ratings for GILD

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Apr 2021SVB LeerinkMaintainsOutperform
Apr 2021Morgan StanleyMaintainsOverweight
Apr 2021Morgan StanleyMaintainsOverweight

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