Key Takeaways

  • Global markets surge after Moderna releases data from early trials
  • Experts warn a long road ahead before effective, usable vaccine
  • 23 vaccine candidates currently in clinical stage of evaluation
  • Frontrunner Oxford Uni/AstraZeneca may complete final stage by September

The now familiar group of reopening stocks – cruises, energy, hotels, airlines, retail etc. – are surging today on vaccine hopes. The big news pushing shares higher this morning is positive early data from Moderna's vaccine trials with humans. The company published preliminary results in The New England Journal of Medicine on Tuesday that expand on its press release from two months ago. Its mRNA-1273 vaccine induced anti–SARS-CoV-2 immune responses in all participants after two doses with no serious side-effects. Neutralizing antibody levels were higher in trial volunteers than average recovered patients. STAT news commented that the data "roughly mirrors" the results from a similar vaccine being produced by Pfizer and BioNTech, which were released July 1. 

It may still be too early to celebrate, warn experts. We still don't know if the antibodies prevent infection and how long the immunity lasts. Before approval, the FDA wants proof that a vaccine would prevent disease or decrease its severity in at least 50% of people who are vaccinated, and blood tests that show immune responses are not sufficient evidence.

The WHO says there are currently 23 vaccine candidates in the clinical stage of evaluation and over 100 in preclinical stages. Investors are keenly listening for signs of success on the medical front, for obvious reasons. "Meaningful progress toward a COVID-19 vaccine could act as a market catalyst in the second half of 2020 and potentially enable a stronger snapback in economic activity and corporate profits than we are currently anticipating," wrote LPL Research. "In that bull-case scenario, we would expect to see the S&P 500 break to new highs in the fall and propel S&P 500 earnings back to 2019 levels in 2021. We would place a 15–20% probability on this scenario, and we consider it may be slightly more likely than the bear case." Shares in Rigel Pharmaceuticals yesterday soared 90.97% yesterday after it announced Imperial College London is testing its fostamatinib drug on COVID-19 pneumonia patients.

Here's an update on some of the top players in the vaccine race:

  • FRONTRUNNER: University of Oxford/AstraZeneca - AZN +8.26% YTD. First to enter final stage of clinical trials (Phase 3). Expected to complete human trials in September.
  • Moderna – stock is +283.33% YTD. Phase 2 began in June, Phase 3 expected to commence July 27 with 30,000 patients.
  • BioNTech/Pfizer - PFE -10.08% YTD, BNTX +147.55% YTD. Positive early data from ongoing Phase 1/2. Granted fast-track designation by U.S. FDA. Phase 2b/3 safety and efficacy study may begin this month.
  • Novavax - stock is +2,663.82% YTD. Phase 1/2 ongoing in Australia.
  • Inovio Pharmaceuticals - stock is +693.94% YTD. Phase 1/2 ongoing. Positive clinical data reported from Phase 1. To begin U.S. Phase 2/3 efficacy study this summer.