Merck COVID-19 Pull Success Batters Shares Of Competitors

Positive clinical trial results for Merck & Co.'s experimental antiviral COVID-19 pill reverberated through the healthcare sector on Friday, sending the drugmaker's stock price soaring while denting high-flying shares of vaccine companies and makers of other coronavirus therapies.

Photo Insert: Analysts speculate that the existence of a pill that can treat COVID-19 may be resulting in people being less inclined to get vaccinated - especially those who are already initially skeptical of vaccines.

Merck shares jumped as much as 12.3% and hit their highest level since February 2020 after data showed the company's pill molnupiravir could halve the chances of dying or being hospitalized for those most at risk of contracting severe COVID-19.

Experts hailed the news as potentially a huge advance in the fight against COVID-19, Lewis Krauskopf, and Manojna Maddipatla reported for Reuters.

At the same time, shares of vaccine makers such as Moderna Inc., Pfizer Inc., and partner BioNTech SE were hit, with some analysts saying the promise of an oral drug that can be taken at home could change the public perception of risks associated with COVID-19.

"We see modest perceived headwind to vaccine stocks such as MRNA (Moderna) if the market thinks people will be less afraid of COVID-19 and less inclined to get vaccines, if there is a simple pill that can treat COVID-19," Jefferies analyst Michael Yee said in a client note.

Moderna shares tumbled 13% in midday trading, while Pfizer, which is developing a COVID-19 pill of its own, fell 1.3%. US shares of BioNTech dropped 11%. For Moderna investors, the Merck news presented an opportunity to lock in gains after an already stunning run.

Shares of Moderna, which were added to the S&P 500 in mid-July, remain up some 220% in 2021 despite Friday's declines. BioNTech's shares were also still up about 200% for the year, even with Friday's fall.

WEEKLY FEATURE : MVP Group Keeps Lights On During Pandemic