How mpox outbreak has helped make pharma company Bavarian Nordic richer

Aug. 21, 2024, 12:39 p.m.

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While global concerns about the mpox outbreak persist, one company has experienced a lucrative consequence of the situation.

Bavarian Nordic, a biotechnology firm, witnessed its stock prices soar by over 15% last week.

This surge occurred just days after the World Health Organization declared mpox a global public health emergency.

But what happened?

Let’s take a closer look:

What happened?

Shares in companies making and developing products against mpox have surged as the European Union’s public health body raised its alert level for the virus spreading in Africa and beyond.

Advertisement Europe’s disease prevention agency said on Friday more imported cases will appear in the region, a day after Sweden reported its first case of mpox linked to the new strain.

Shares of Bavarian Nordic, a Danish biotech company that produces an mpox vaccine, surged by 20% on Friday.

The company's stock had already seen a 50% increase the previous week due to growing concerns about the virus.

Bavarian Nordic’s shares closed up 17.8 per cent at 282.5 Danish crowns.

The company now has a market cap of $3.28 billion.

What do we know about the firm and its vaccine?

As per Fortune, Bavarian Nordic was founded in 1994.

It is a Copenhagen-based pharma company.

According to Forbes, Bavarian Nordic stands out as one of the few companies with a globally approved mpox vaccine.

The vaccine is marketed under the brand names Jynneos, Imvamune, and Imvanex.

As per Fortune, the vaccine was approved in 2022.

The company started developing its smallpox vaccine in 2003, which is similar to its mpox vaccine, with support from the US government.

Bavarian Nordic, a Copenhagen-based pharmaceutical company founded in 1994, is a preferred choice for healthcare companies due to its favorable safety profile compared to its competitors. Image courtesy: www.bavarian-nordic.com

The company has also provided vaccines for other public health emergencies such as the Ebola virus, according to Fortune.

The firm received a significant order from Johnson & Johnson's Janssen Pharmaceutical Companies in 2021 for $28 million.

According to Fortune, the company recently donated 40,000 doses of its mpox vaccine to the Africa CDC.

According to Arab News, the company stated its intention to increase production of its mpox vaccine.

Bavarian Nordic has pledged to collaborate with international health organizations to ensure equitable access to its vaccine.

The company informed the Africa Centres for Disease Control and Prevention (CDC) that it can supply 10 million vaccine doses by the end of 2025.

Advertisement The company has stated it could deliver approximately two million doses in 2024.

The company informed Fortune that it can accomplish this because it possesses the stock “to provide a surge capacity for potential outbreaks.”

Jefferies analysts said in a note on Thursday they expect significant orders for Bavarian Nordic’s mpox vaccine due to the outbreak.

Jefferies analysts indicated that up to approximately 3 million doses of the vaccine could potentially be made accessible in 2024, with the potential for 10 million doses in 2025.

‘International community needs to come together’

Securing approval for administering the vaccine to adolescents and children would be crucial, they stated.

According to Forbes, on Friday, the company submitted data to the EU medical regulator regarding its vaccine's effectiveness for children aged 12 to 17.

Advertisement Bavarian said the regulatory body could authorize the expansion of its vaccine's use for children as early as October.

The company also plans to conduct trials of the vaccine on children as young as two years old.

"The latest data we submitted is incredibly significant as it could potentially extend the use of our vaccine to adolescents," Bavarian Nordic CEO Paul Chaplin told CNBC.

"The international community must collaborate with Bavarian Nordic to ensure widespread distribution of this vaccine and contain the outbreak," he added.

Advertisement Other vaccine makers’ shares spike

Bavarian Nordic isn’t alone.

Shares in Emergent BioSolutions gained 15 per cent in US trading.

The vaccine, originally approved for smallpox, has also been used as an mpox shot, but the US Food and Drug Administration has not yet given its official permission for using it against the virus.

In 2017, the company acquired a smallpox vaccine from French pharmaceutical giant Sanofi known as ACAM2000, as reported by Forbes.

Shares of other companies engaged in the mpox response have also exhibited significant volatility this week.

Shares of SIGA Technologies jumped seven per cent on Friday.

This followed a decline of nearly 20 percent the preceding day after its mpox drug failed to achieve the primary objective in a clinical trial.

Concurrently, Geovax Labs, listed on the US stock market, which held a market capitalization under $20 million as of Thursday, experienced a 60 percent increase to $5.35 in early trading.

The company is developing a vaccine against mpox and smallpox.

Mpox cases have been confirmed among children and adults in over a dozen African nations, and a new strain of the virus is spreading. There are few vaccine doses available on the continent.

The Democratic Republic of Congo has the largest number of mpox cases and currently requires 3 million vaccine doses.

The US and Japan have pledged to donate vaccines, Health Minister Roger Kamba informed journalists. He did not specify the number of doses to be sent or the arrival date of the Japanese vaccines.

The WHO has reported over 17,000 mpox cases and over 500 deaths globally this year. More than 96 per cent of all cases and deaths have occurred in Congo, whose healthcare system has long faced challenges in controlling disease outbreaks due to the country’s vast size and limited infrastructure. Children under 15 account for more than 70 per cent of the cases and 85 per cent of deaths in Congo.

Scientists are also worried about a new version of mpox in Congo that might be easier to spread. Last week, Sweden announced its first case of this new version.

Officials stated that the risk to the general public is considered “very low” and that they anticipate sporadic cases brought in from other countries to continue.

Unlike previous mpox outbreaks, where rashes were primarily observed on the chest, hands, and feet, the new variant presents milder symptoms and skin lesions concentrated on the genitals. This makes it more difficult to identify, meaning individuals might unknowingly spread the infection to others. Mpox transmission is not airborne and usually necessitates close, physical contact.

The World Health Organization (WHO) has reported the recent detection of mpox in four East African nations: Burundi, Kenya, Rwanda, and Uganda. These outbreaks have been traced back to the ongoing epidemic in Congo.

With inputs from agencies