The coronavirus pandemic continues to shine brightly in corners of the economy that are simply not accustomed to attention. Biotechnology is a wonky and underappreciated industry that is currently front and center, especially companies that may have an effective coronavirus vaccine in development.
Shares of one developer of a coronavirus vaccine, BioNTech (NASDAQ: BNTX) this year has gone up 129%, and the buzz around Germany-based biotech is on a very high note. Here are some of the reasons.
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The BNT162 program
BioNTech’s most popular attraction at the moment is an experimental partnership with coronavirus vaccine program Pfizer (NYSE: PFE) called BNT162. This, like all drugs in the pipeline of the development of BioNTech, delivers strands of messenger RNA (mRNA) that coax a patient’s own cells in producing therapeutic proteins.
In the case of BNT-162, the strands of messenger RNA delivered lead to the production of proteins that mimic found on the surface of SARS-CoV-2, the virus that causes COVID-19 . This should train immune system to recognize the actual virus before it infects.
The BNT162 program took an unusual step along the development path and began clinical trials with four similar candidates before choosing one to advance in a pivotal study of 30,000 patients that began in July.
If the two-dose regimen successfully reduces the risk of COVID-19 volunteers by a 50% threshold set by the Food and Drug Administration, BioNTech and Pfizer will provide the US government with up to 100 million doses for $ 1.95 billion starting so early October. The government also has an option to purchase up to 500 million doses.
Cancer therapy
BioNTech does more than develop vaccines to tackle the latest scary infectious diseases. In July, the company published interim results of a phase 1 trial intended to register 115 patients with advanced-stage melanoma (a skin cancer) and treat them with BNT111.
This is a cancer vaccination that leads to the production of four different proteins that mimic such commonly associated with melanoma, and it should encourage strong immune responses that blow tumors to bite. Results from a subset of 42 patients who had previous experience with a checkpoint inhibitor, such as Keytruda, suggest that BNT111 works as intended. Nine patients from this group showed a partial tumor response, and one achieved complete remission.
The development of mRNA-based drugs is relatively easy in the early stages, allowing the early clinical stage of BioNtech puncture to punch above its weight. In addition to BNT111, the company has several vaccine candidates in Phase 1 studies for the treatment of prostate cancer, HPV (human papillomavirus) -related cancer, breast cancer, and ovarian cancer.
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A good stock to buy now?
During almost every cancer study, the response of tumor response tends to the initial interim analysis. The figures we have seen from BioNTech guarantee further research, but they are not great.
The company did not intend to test BNT111 in patients after a failed previous treatment with Keytruda and other PD-1 inhibitors before the trial began. Before placing any value on cancer vaccine programs, investors want to wait for data from all patients treated with BNT111, as originally intended.
Note that the development of mRNA-based candidates – like any unproven class of therapy – rarely leads to yield-producing products. In the largest study of drug development success rates to date, just 9.6% of drugs introduced in clinical trials in 2005 and 2015 went through with FDA approval. This poor success rate does not separate potential new classes of drugs from new drug candidates, similar to those already proven to be effective.
At recent prices, BioNTech is sporting an inflated market capitalization of $ 17.9 billion. That could grow further as BNT162 becomes the first mRNA-based candidate to earn approval, but it’s a long shot, and the stock has not climbed much further from its current rating.
Since the U.S. government agreed to accept all financial risks, BNT162 skipped the mid-stage testing process and jumped right into a 30,000-patient Phase 3 trial. Based on what we know so far, the chances of success are stacked against BNT162 – and against a positive return of this risky biotech stock.
