Coronavirus-related share price changes in biopharma companies Jan-Feb 2020

Biopharma companies that are involved in the race to develop treatments for COVID-19 are seeing significant changes to their share price. Between January 20 and February 25, 2020, Novacyt and Co-Diagnostics saw their share prices surge by around 800 percent and 300 percent, respectively.

Why are some companies benefiting from COVID-19?

As the search for COVID-19 treatments continues, the spotlight is being shined on biopharma companies trying to contain the spread of the disease. Media attention is helping to drive the short-term share price of companies with COVID-19 programs because opportunistic investors can see the potential in biotech and pharmaceutical stocks. Two companies that have seen their stock value rise are Gilead Sciences (makers of remdesivir) and Moderna (developers of mRNA vaccines).

Gilead’s stock soars on the back of promising research

From a business standpoint, companies could be propelled even further if clinical trials reveal a drug that can successfully treat COVID-19. One of the investigational medicines to show the most potential is remdesivir, which is developed by Gilead Sciences. The drug is being repurposed, and testing is underway to evaluate its safety and efficacy in patients. Positive early data has been reported in the media, and public attention has led to huge changes in the company’s market capitalization. In the United States, the FDA issued an emergency use authorization for remdesivir for the treatment of patients with severe COVID-19 on May 1, 2020.