The global pandemic changed a lot of plans in 2020. Jobs were lost, vacations were canceled, and remote learning became the norm. But as disruptive as the coronavirus has been, for some companies it offered an opportunity to expedite research and apply existing therapies in a new way to help save lives.
For Regeneron Pharmaceuticals (NASDAQ:REGN), Gilead Sciences (NASDAQ:GILD), and Moderna (NASDAQ:MRNA), what started as a year of trudging along with existing research was upended by a national emergency.
1. Regeneron Pharmaceuticals
While Regeneron has seven drugs approved by the U.S. Food and Drug Administration (FDA) and more than 20 medicines in clinical trials, 2020 became all about the company’s monoclonal antibody treatment for the coronavirus as soon as President Trump received the treatment and began touting it as a cure in public appearances.
The drug is a combination of two antibodies that bind to the virus: one from a human who has recovered from COVID-19, and another from a mouse that was engineered to have a human immune system. The company received a $450 million contract in July to ramp up manufacturing of the treatment so that it could be immediately available upon approval.
While earlier phases of clinical trials demonstrated reduced amounts of the virus in a patient and shorter time to recovery, the trial evaluating more severe cases of COVID-19 was stopped late last month due to a safety concern. Despite the setback, the success in patients with no or mild symptoms will become more important as testing continues to increase.
Analysts think peak sales of the drug could reach $1 billion in 2021, which would represent nearly 13% sales growth for the company versus 2019 just from this treatment. And given the challenges of distributing a vaccine, and a citizenry that is now evenly split on whether they would even get one when approved, those sales are likely to persist beyond 2021.
2. Gilead Sciences
It makes sense that Gilead would be in a position to develop a treatment for the coronavirus. The company made a name for itself in the early 2000s with revolutionary treatments for HIV (the virus that causes AIDS) and followed up with the acquisition of a drug that cures most patients with another virus, hepatitis C.
Remdesivir originally received an emergency use authorization (EUA) in May, then an expanded EUA in August, and finally FDA approval in October to treat hospitalized COVID-19 patients. Although the drug had already been investigated as a potential treatment for Ebola and the respiratory syndromes SARS and MERS, it was never approved by the FDA. While the FDA did approve Remdesivir for COVID-19 based on three studies the company conducted, that move was controversial. Critics pointed out that one of the studies lacked a control group and the other two were not blinded.
Furthermore, the World Health Organization has published a dismissal of the drug’s efficacy in what it considers a definitive study across 500 hospitals, 12,000 patients, and 30 countries.
The skepticism isn’t slowing sales. Management recently reported $873 million in sales of remdesivir in the third quarter, and analysts estimate between $650 million and $950 million in the fourth quarter. This bump accounted for all but 2% of the company’s 18% sales growth last quarter. With the cost of a five-day course of treatment coming in at about $3,100 and cases of COVID-19 seeming to set new records each day, a long-investigated drug without a disease was transformed into a blockbuster revenue producer, despite the leading global health organization flatly dismissing its benefits.
Flat sales for Gilead in 2019 broke a string of three consecutive years of declining revenue. Now that the U.S. government has agreed to purchase 500,000 doses of remdesivir through the end of the year (the bulk of the global supply), the company is set to add almost $3 billion to its top line this year. For Gilead, a global pandemic and friendly regulatory decision may lead management to remember 2020 as the year the company started growing again.
Despite Moderna’s cutting-edge research in using messenger ribonucleic acid (mRNA, or messenger RNA) to treat diseases, the company has never had a drug approved. In fact, no vaccine has ever been approved using this approach — which involves creating genetic instructions for the body’s cells to produce an immune response for a specific disease or condition.
The company isn’t new to the FDA process; it received a coveted fast-track designation in August 2019 for its Zika virus vaccine candidate, which was then in phase 1 trials. The fast-track program is an expedited review reserved for treatments for serious unmet needs. In May, the company again received the designation, this time for its COVID-19 vaccine candidate.
Early last month, CEO Stephane Bancel told an audience that Nov. 25 is the soonest his company would be able to file the EUA request for the much-anticipated potential vaccine. If approved, it will be a more expensive option than other vaccine candidates being discussed. Pre-orders have been set at between $32 and $37 per dose, while others range from a few dollars to as much as $19.50.
Of all the COVID-19 vaccine candidates, Moderna’s is perhaps the most anticipated because of what it might mean for mRNA therapies. Because it involves synthetic instructions delivered to cells, an mRNA vaccine could be more potent by triggering all of the body’s defenses, as well as being easier to manufacture than traditional vaccines. This combination of potency and scalability would introduce a new era in humanity’s fight against infectious diseases.
For this reason, if Moderna’s candidate is approved, it will be a milestone year for the company. In many ways, 2020 has provided the company an opportunity to show that it was built for this moment.