The growing concern for a potential global outbreak of monkeypox has sent shares of the biotechnology company behind the only approved vaccine soaring.
From a market value of $1.2 billion in May, Bavarian Nordic (BVNRY) has now reached $3.4 billion.
More than that, this figure is expected to climb higher as the World Health Organization (WHO) recently declared monkeypox a “public health emergency of international concern.”
Bavarian Nordic wasn’t the only vaccine maker that benefitted from this announcement. Shares of other developers, notably Siga Technologies (SIGA), Emergent Biosolutions (EBS), and Inovio Pharmaceuticals (INO), were also buoyed.
To date, there are roughly more than 16,000 recorded cases of monkeypox worldwide and 5 deaths. Most regions are categorized as moderate risk, while Europe is placed at high risk due to the number of infections in the area.
Siga Technologies rose 26% following WHO’s announcement. This company develops an antiviral named TPOXX, which is approved by the EU to use against monkeypox. The US has also stockpiled this drug despite not yet being approved by the FDA.
Meanwhile, Emergent Biosolutions climbed 11% after the news came out. While it’s also not yet marketed commercially for this particular outbreak, this biotech has developed a smallpox vaccine that could be applied as a preventive measure for monkeypox.
As for Inovio Pharmaceuticals, which rose 6%, the company does not have a monkeypox-centered product in its pipeline or portfolio. However, the biotech worked on an experimental vaccine against smallpox in 2010. This candidate is reportedly able to provide protection against monkeypox.
Despite all these candidates, Bavarian Nordic’s monkeypox vaccine, called Jynneos, is expected to remain the dominant vaccine. Apart from the US, it was also approved as a monkeypox vaccine in the EU and Canada.
Jynneos, which is administered in two doses, works as a non-replication live virus vaccine. It uses a modified or altered version of a virus that came from the same family as the monkeypox. The goal is to train the immune system to fight off monkeypox and smallpox infections.
Essentially, Jynneos is an advanced version of Emergent Biosolutions’ smallpox vaccine.
Considering the potency and safety of Jynneos, experts believe that no other smallpox or monkeypox candidate could rival Bavarian Nordic’s vaccine in the next 10 to 20 years.
Aside from the difficulties of developing a new and better vaccine, gathering data to prove the efficacy of the candidates would be highly challenging. Large-scale clinical trials involving humans might not be possible, both from an ethical and practical point of view.
Since it’s the only vaccine authorized so far, Bavarian Nordic is arguably the best bet for investors looking to capitalize on this demand.
Moreover, the biotech company has a strong balance sheet and can produce at least 30 million doses of its product. It also has several candidates in its pipeline, making it a safe play in this space.
In terms of competitors, the closest would most likely be Siga Technologies, which has a market capitalization of $1.3 billion. This biotech has a similar profile to Bavarian Nordic.
Meanwhile, its vaccine, TPOXX, showed little to no side effects. More than these, Siga recently received approval from the EU. That means gaining FDA approval in the US could very well be on the way as well.
Overall, there’s an apparent demand for the monkeypox vaccine. Right now, it’s only offered to individuals suffering from monkeypox or with significant exposure to infected people.
While it may not reach the heights of Moderna (MRNA) and BioNTech (BNTX) in terms of skyrocketing share prices, Bavarian Nordic’s vaccine is a great stepping stone for the company.
After all, Jynneos is basically a cousin to the smallpox vaccine that practically saved humanity.
So, if someone gets it, they would probably get the vaccine, just like you would rush to the hospital for a tetanus shot if you stepped on a rusty nail. Without these vaccines, life and the economy as we know them today would not be possible.
