FX168 Financial News (North America) News The increasing number of human cases of avian influenza has attracted investors to buy shares of vaccine developers. This is a familiar situation for industry veterans who have witnessed a trading frenzy in the early days of the outbreak.
CureVac NV's avian flu vaccine is in early testing. Shares rose 15% on Wednesday as concerns about a possible human avian flu outbreak intensified after Australia reported new cases.
(Source: Bloomberg)
Novavax Inc. recently announced plans to develop an avian flu vaccine, and the stock rose for the third day in a row, closing at its highest level since December 2022.
Moderna Inc. shares rose 2.9% in after-hours trading, while Pfizer shares rose 1.4% after reports said the two companies were in talks with the US government on the development of an avian flu vaccine. Moderna and BioNTech SE, another COVID-19 vaccine maker, achieved double-digit gains in regular trading, while Pfizer shares rose 3.6%.
Mizuho healthcare expert Jared Holtz said, “Avian flu is adding momentum to stocks that have already risen. In the context of these headlines, more retail-oriented deals are linking problems caused by bird flu to vaccine stocks.”
Past outbreaks such as Ebola, Zika, and monkeypox have caused similar fluctuations, particularly for small businesses, as some companies have launched vaccines or treatment plans. Investors looked for potential winners, but in the end, only a few companies were able to successfully develop treatment plans. Companies like Moderna or BioNTech have even fewer stocks that can become household names.
Holtz said the stock's reaction so far has been “pretty extreme.” He suggests taking advantage of the opportunity to sell because it's unclear whether the disease will spread or have any impact on earnings, although “this story is definitely going to get more popular.”
Many vaccine names have risen even before new cases are reported. Since signing a license agreement with Sanofi two weeks ago and revealing its bird flu plans, Novavax's stock price has been soaring. Following the recent victory over Pfizer's patent, Moderna shares began to rise.