Prominent Analyst on COVID-19 Vaccines & Therapeutics & ‘Trench Warfare’

Prominent Analyst on COVID-19 Vaccines & Therapeutics & ‘Trench Warfare’

Geoffrey Porges, a prominent SVB Leerink analyst covering therapeutics research, recently visited Brian Sullivan’s CNBC Worldwide Exchange, suggesting that that the global vaccine rollout must be more “consistent” but also emphasized some good news, noting that therapeutics under clinical development are improving.  While the prominent investment bank analyst recognizes the importance of consistent vaccination, he observed risk inherent in what could be deemed a slowdown, a shift from the all-out war approach to what is now unfolding as a kind of trench warfare.  Commenting on some of the challenges with the mass vaccination imperative, such as the generation of lots of anxiety and other issues, the analyst and the show’s host, of course, avoid the complete lack of international coordination during this pandemic, a failure to a great extent of the World Health Organization (WHO), but also major rich economies (including the USA, UK, Germany, Japan, China, etc.) that have, in some cases, taken far more nationalist or self-interested approaches to a problem that knows no boundaries. After all, the SARS-CoV-2 pathogen and its mutant variants swirl around worldwide as long as people are moving. Porges acknowledges that more vaccination consistency is months or even possibly a year away, manifesting into 2022. The analyst suggests good news may be forthcoming  in the form of therapeutic improvements and as pressure wanes on hospital systems, more drugs will be available along with accumulating knowledge, leading to improved best practices, directing better care with the use of antivirals such as remdesivir, or monoclonal antibodies and even he contends some of the anti-inflammatories. Porges declares that the outlook for declining hospitalization of those with COVID-19 has improved. But with 700 to 800 people dying each day in the USA, Porges rightly reminds the audience that America still finds itself in an unacceptable situation.  Of course, this isn’t a national problem; it’s a world problem. The complete lack of coordination among nations has been frankly appalling. Not mentioned in any detail is an unfolding catastrophe in India, a close U.S. ally, with over 2,000 people now dying per day. All lives matter, and no government agencies should rest until this pandemic is well under control.

A Brief Overview

Therapeutics are of vital importance, and this media platform (TrialSite) emphatically declared this all along. While the National Institutes of Health (NIH) directed billions of public (taxpayer) dollars to the Accelerating COVID-19 Therapeutic Interventions and Vaccines (ACTIV) program, the overwhelming focus as chronicled by TrialSite has been on vaccines and novel therapeutics which were not designed for the majority of COVID-19 cases, most often take a long time to develop, and of course, in the rare cases that they are approved, they are incredibly costly.

In many respects, a massive failure of government health agencies—requiring real scrutiny, audits and some kind of reform—should be on the table. TrialSite suggested that the make-up, structure and focus of ACTIV has been greatly influenced by industry and by a sort of  academic medical elite belief system, versus the pragmatic realities of care on the ground during the pandemic.

For example, even though 90% of COVID-19 cases are asymptomatic mild to moderate at onset in nature, the most powerful, best-funded biomedical research agency in the world—directing  billions of dollars—especially with the booster of Operation Warp Speed, established by the previous POTUS—put little thought into that as manifested in the various treatments under study. Just this month, over a year after the pandemic onset, NIH finally got around to announcing ACTIV-6 where some repurposed drugs that can be taken at home will be tested.

But a form of crony scientific capitalism has taken hold as regulatory capture grows, evident in what’s under development, especially in the first several months of the pandemic. Novel drugs take many years, and command huge premiums for the companies, and the NIH opted for that over pragmatic care while over half a million people have died. The topic of repurposed therapeutics represents a true disaster on the part of the NIH and other government funding sources. But now the market is opening up to the massive potential of the 90% COVID-19 use case—therapeutics for those with asymptomatic to mild to moderate, early onset COVID-19.  Generic approaches that gained steam, such as ivermectin, were quickly shunned—along with the data that many experts thought compelling—to clear open the market space. But what firms will win a market that literally could be worth north of $10 billion per annum?

Failure on the Treatment Side

Hence the importance of therapeutics now as a topic of concern. Sullivan, the CNBC host, acknowledged progress but called out, “We probably failed on the treatment side” and hence why Porges was invited to come on and comment. But has the host really boxed in the topic to just a few companies so that he can try to direct market activity?

The host noted that while Regeneron has a treatment as does Roche (which TrialSite fact checks prove as quite debatable), he notes, “they hardly get any attention from the media.” Well, this isn’t true at all.  Regeneron’s study has received considerable attention. Many local media tout the cocktail monoclonal antibody studies as TrialSite’s daily chronicling can attest. It’s as if Sullivan is probing to determine if stock prices are somehow depressed due to a lack of media attention.

Where should the Money go?

The prominent host asked the analyst if any particular therapeutic treatments were gaining investor attention—and if so, which ones looked like the best candidates? Of course, he wouldn’t answer that on the show. One would have to become a SVB Leerink client.

The sharp analyst shared that that lots of capital was flowing into a number of promising early stage therapeutic treatments for COVID-19, ones the analyst touts are even better than the ones available today. This claim probably should have been emphasized should they be authorized by the FDA.

Porges declared that a key problem is that existing therapies, such as those authorized under emergency use, are not being sufficiently used. He suggested that Gilead’s remdesivir is used in about 50% to 60% of people who are hospitalized for COVID-19 in America. This, of course, has been true especially for the vast number of cases—90% of the total COVID-19 cases. Those that are seeking off-label treatment from their doctors with ivermectin or fluvoxamine were reminded by Dr. Fauci recently that’s not a good idea.

The Omission of Some Reality

Interestingly, the guest told CNBC, “use of remdesivir has been modest outside the U.S. and “that needs to go up.” But what the expert doesn’t share with the audience is that many countries, including several in the European Union, have pretty much rejected remdesivir based on the World Health Organizations Solidarity study, revealing that the antiviral drug doesn’t sufficiently help patients with COVID-19. Moreover, a growing number of researchers and physicians are leery of the health risks associated with remdesivir.

In this way, this investor show isn’t objective at all and certainly carries a bias toward favoring certain securities. Otherwise, material facts would surface, such as big swathes of the world won’t use remdesivir. Now Brian Sullivan is a great guy and even contacted TrialSite early on to learn more about the fledgling online media, but in this way, the charismatic, charming and smart host is unfortunately beholden to a higher power.

Monoclonal Antibody ‘Catch 22’

Porges rightly goes on to explain the dilemma associated with antibody therapeutics either authorized under emergency use or in clinical development, what is a “catch 22” situation. While the experimental regimen, such as the cocktail antibody product from Regeneron, sits in the hospital medication rooms, the indication is for pre-hospitalization so often what happens is that someone diagnosed with COVID-19 seeks the antibody treatment, again, such as the cocktail REGN-COV, but the hospital declares that the patients not sick enough for hospital admission so they are precluded from administering the antibody. That, of course, hinders sales growth, which is the key to any asset valuation.  

So Porges declares it’s a “round and round” problem that TrialSite has emphasized reveals yet another example of the NIH and ACTIV’s lack of vision, focus, and attention to actual healthcare, especially during the onset of the pandemic. Yes, the vaccine breakthroughs have been incredible but that’s due primarily to the unleashing of entrepreneurial forces in biopharma, made possible by Operation Warp Speed’s urgency, allowing the rapid capitalization of decades worth of  advancements in the making with life science technology such as mRNA. 

Porges confirmed there has been minimal adoption of the existing pack of antibodies but he again observed that the new clinical development crop looks quite promising.  The analyst emphasized “those that can be given in the doctor’s office” or “given in a walk-in med clinic,” and he is absolutely correct!

He stressed that these new investigational therapies show great promise for far superior care than what the nation’s patients have experienced to date. He summarized that the existing antibodies, however, need to be used “much more broadly” in COVID-19 cases involving pre and post contact exposure.  

The Pandemic Age is a Complicated One for Investors

So this investor-minded program perhaps views the world in somewhat narrow terms as to where investors should place their money. That’s perhaps because all of the material information isn’t offered. Given the dire need for safe and effective therapeutics, the point of view centers on when markets wake up so to speak and not just focus on vaccines but also on the mission-critical function of therapeutics targeting COVID-19.

After all, SARS-CoV-2, the virus behind COVID-19, is not only hanging around but will continue to morph and evolve, causing ongoing problems. Human society to some extent will have to learn to live with and deal with it as not all people will get vaccines as well as the fact that vaccines don’t work all the time. 

Moreover, the vaccine companies cannot be certain how long the two jab potency lasts. Already, talk of a third jab and boosters has gone to the lab, and clinical trials are ongoing. 

Places like India, now in a devastating wave of this pandemic, face a multiplicity of challenges, including a very low rate of vaccination.  Currently only about 1% of the population has received a complete two jab inoculation. 

The market forces that CNBC’s show follows closely have assured that in the age of COVID—a period more prone to nationalistic tendencies and less keen on international collaboration—that residents of poor countries will immeasurably suffer. The rich countries quickly bought up vaccine supply, ensuring shortages, bottlenecks, and chaos even in wealthy Europe. 

The world’s population is nowhere near vaccination en masse any time soon. And that’s a problem because again pathogens like SARS-CoV-2 know no boundaries. The economy and, ultimately, investors pay the price. 

 But Sullivan and Porges don’t dare bring up the taboo topic of China and their complete insulation from this crisis. How did they do it? Was it just totalitarian-inspired lockdown after lockdown or are they doing something, or do they know something, others do not? By the way, their gross domestic product, conveniently, cranks on all cylinders and will surpass the USA as the number of economies move faster than forecasted.

The Gripe

If therapeutics are key moving forward, Sullivan seems to want to understand why there isn’t more market movement in therapeutic stocks, e.g. Regeneron and Gilead. But if one looks historically at the Regeneron share price and corresponding market capitalization, it’s fairly high, albeit not at the top. But that’s because the market is aware that Regeneron has only limited play in what it can do for this pandemic, factored with other dynamics about the company. Otherwise the market forces would set the price higher. But the CNBC host seems to think it could just possibly come down to a brand awareness, e.g. lack of media coverage issue, or at least he seems to imply this. Serious money is being made over this pandemic but the center of action is somewhere else and perhaps to Porges point, those investors that understand what trench to observe in a very detailed way may end up ahead, at least for that moment.

Responses