If you've spent the last few months trying to pick the winning stock of the swine flu vaccine horse race, here's a challenging opinion for you…you might be wasting your time. It's not that they're necessarily won't be a winner. Indeed, there may be several winners. But, maybe the word 'winner' is strictly a relative term.

20 Tools For Building Up Your Portfolio

The Latest
Though the World Health Organization has been dealing with the swine flu outbreak since March, it wasn't until the last few days they deemed it 'unstoppable' as a pandemic. As such, the WHO also formally gave pharmaceutical companies the full go-ahead to begin making H1N1 vaccines.

A spokesperson for the World Health Organization also said a vaccine could be ready by September.

But which vaccine? Which company? Great question - they didn't say. I'm sure the WHO knows several companies are working on them; I just don't think they care at this point by who or how many companies it's made.

So is it possible that several pharmaceutical manufacturers are in a position to win this game? It seems to be the case, especially if revenue is the scorecard.

Cash-Backed Demand
At the same time the WHO was announcing that the swine flu outbreak was unstoppable, the United States - through the U.S. Health and Human Services office - was committing another $884 million towards H1N1 vaccine ingredients (on top of the $1 billion allocation from May). This latest round of money was being allocated to four different companies. Other governments are also throwing money at manufacturers using the shotgun approach.

Multiple companies are winning, even though none of them have actually produced a tested and approved swine flu vaccine yet. (Learn more about investing into companies that perform significant research and development in our article Buying Into R&D.)

Who Gets What?
Baxter International (NYSE:BAX) could be getting an estimated $245 million in sales from France, and the U.K. has ordered up to 90 million doses of an H1N1 vaccine through a Baxter/Glaxo partnership. Though no price has been set yet, a cost of $10 per dose of flu vaccine seems to (roughly) be the going rate. So, it wouldn't be off base to say Glaxo and Baxter could be splitting up to $900 million.

GlaxoSmithKline (NYSE:GSK), aside from the deal with Baxter and the U.K. government, will also be receiving $71.4 million from the U.S. government for bulk oil and water adjuvant.

Novartis (NYSE:NVS) will be one of four companies splitting over $900 million from the France vaccination effort. The biggest win will come from the latest round of U.S. spending though. Novartis will be collecting another $690 million for its antigen.

Interestingly, the U.K. has not placed an order for any of the Novartis vaccine, though the company reports 35 other countries have. That's the power of being first, though it's not yet clear how well the vaccine performs.

Sanofi-Aventis (SNY) - through Sanofi-Pasteur - will also be splitting France's $900 million effort in addition to collecting $61.4 million from the U.S. Health and Human Services office for bulk vaccine antigen.

MedImmune, a subsidiary of AstraZenaca (NYSE:AZN), is in line to collect $61 million from the U.S. government for its nasal spray version of an H1N1 vaccine. That's on top of the $90 million contract from earlier this year.

There's another company that's also in the swine flu vaccine race that we haven't heard much about - Sinovac Biotech Ltd. (NYSE:SVA). We do know that China's government ordered 4 million vaccine doses, which should roughly translate into $40 million in revenue (if the pricing is consistent with other flu doses). The company is planning to supply up to 10 million doses to the Beijing government.

The Bottom Line
That's a lot of dollars, and bear in mind this new money is an addition to the initial orders place immediately after the worry began this spring.

Many have been trying to pinpoint which company is making the 'best' swine flu vaccine. Maybe you don't have to. It looks like any and all of them are in demand, since there's not enough of it around (and won't be for a while). As long as they show any efficacy at all in testing, and don't cause major harm, I have a feeling they'll all be widely used.

Why? Because at this juncture, quantity is more critical than quality. That will change once the pandemic is under control, but for this first wave, I think all these stocks have something going for them. The top lines are already set up very nicely for Q3 and Q4. (See Patents Are Assets, So Learn How To Value Them and Pharma Patent Trolls: Cheap Drugs At A Steep Price for additional reading.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Stock Analysis

    Will WYNN Continue to Rally?

    Wynn Resorts has experienced a rally recently. Will it remain a good bet?
  2. Stock Analysis

    Don't Be Fooled by the Market's Recent Rally

    The bulls won for a bit in early October, but will bears have the last laugh?
  3. Stock Analysis

    Will Twitter's Stock Find its Wings Soon?

    Twitter is an enigma to many investors, but its story is pretty straightforward.
  4. Stock Analysis

    8 Solid Utility Stocks for a Bear Market

    If you're seeking modest appreciation, generous dividend payments and resiliency, consider these eight utility stocks.
  5. Stock Analysis

    Why Phillips 66 (PSX) is a Solid Long-Term Bet

    Here's why Phillips 66 will likely remain one of the world’s largest and most profitable companies for a long time to come.
  6. Stock Analysis

    3 Resilient Oil Stocks for a Down Market

    Stuck on oil? Take a look at these six stocks—three that present risk vs. three that offer some resiliency.
  7. Economics

    Keep an Eye on These Emerging Economies

    Emerging markets have been hammered lately, but these three countries (and their large and young populations) are worth monitoring.
  8. Stock Analysis

    Is Pepsi (PEP) Still a Safe Bet?

    PepsiCo has long been known as one of the most resilient stocks throughout the broader market. Is this still the case today?
  9. Investing

    The ABCs of Bond ETF Distributions

    How do bond exchange traded fund (ETF) distributions work? It’s a question I get a lot. First, let’s explain what we mean by distributions.
  10. Stock Analysis

    3 Stocks that Are Top Bets for Retirement

    These three stocks are resilient, fundamentally sound and also pay generous dividends.
  1. How do dividends affect retained earnings?

    When a company issues a cash dividend to its shareholders, the retained earnings listed on the balance sheet are reduced ... Read Full Answer >>
  2. What is the difference between called-up share capital and paid-up share capital?

    The difference between called-up share capital and paid-up share capital is investors have already paid in full for paid-up ... Read Full Answer >>
  3. Why would a corporation issue convertible bonds?

    A convertible bond represents a hybrid security that has bond and equity features; this type of bond allows the conversion ... Read Full Answer >>
  4. How does additional paid in capital affect retained earnings?

    Both additional paid-in capital and retained earnings are entries under the shareholders' equity section of a company's balance ... Read Full Answer >>
  5. What types of capital are not considered share capital?

    The money a business uses to fund operations or growth is called capital, and there are a number of capital sources available. ... Read Full Answer >>
  6. What is the difference between issued share capital and subscribed share capital?

    The difference between subscribed share capital and issued share capital is the former relates to the amount of stock for ... Read Full Answer >>

You May Also Like

Trading Center
You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!