Pfizer Inc. is poised to secure a greater slice of the COVID-19 vaccine market share after its Comirnaty shot became the first to receive U.S. approval, an analyst has told S&P Global Market Intelligence.
The U.S. Food and Drug Administration's approval of the vaccine, developed with partner BioNTech SE, could spur further mandates for employees of hospitals, schools and businesses, as well as among military personnel, the Pentagon said in an early August statement. Roughly 85 million Americans remain unvaccinated.
The approval could also help increase confidence in the vaccine and improve vaccination rates, Edward Jones analyst Ashtyn Evans told Market Intelligence in an Aug. 23 email.
The FDA's decision is likely to position Pfizer, which is also conducting trials of a version of the shot tailored to the Delta variant of the virus, to further cement its market share for continued COVID-19 vaccine sales, Evans said.
"We believe Pfizer will benefit in the near term from profit from the vaccine, which the company can use for internal R&D spending and for acquisitions to strengthen its innovative portfolio," Evans said Aug. 23, pointing to the same-day announcement that Pfizer would purchase cancer-drug maker Trillium Therapeutics Inc. for $2 billion.
The U.S. government alone has already agreed to purchase 500 million doses from Pfizer to be used in the country. At $1.95 billion for every 100 million doses, officials have not indicated that the full approval of the vaccine will make further contracts necessary. Pfizer and Germany's BioNTech are also providing 500 million more doses on a not-for-profit basis to be donated to the world's poorest countries.
The two companies had secured contracts for 2.1 billion doses worldwide as of mid-July, with the potential for as many as 3 billion doses by the end of the year.
Shares of Pfizer were up 3.23% to $50.29 per share as of 11 a.m. ET on Aug. 23, while BioNTech's stock was up 10.63% to $385.73 per share.
Fellow mRNA COVID-19 vaccine-maker Moderna Inc. also saw a rise on the news, with stocks up 5.51% to $404.07 per share. The FDA is reviewing Moderna's shot, and full approval is expected in the coming weeks.
Between the mRNA vaccines from Pfizer-BioNTech and Moderna, about 600 million doses have been delivered to the U.S. government so far, Jefferies analyst Michael Yee said in an Aug. 18 note. About 260 million of those doses remained on shelves in the U.S. when the Biden administration announced its plan to begin making booster shots available to fully vaccinated adults in September.
The timing of the FDA approval affirmed the efficacy and safety of the vaccine "at a time when it is urgently needed," Pfizer CEO Albert Bourla said in an Aug. 23 statement.
"I am hopeful this approval will help increase confidence in our vaccine, as vaccination remains the best tool we have to help protect lives and achieve herd immunity," Bourla said.
The CEO said in a July 28 earnings call that full FDA approval would likely help some people overcome their hesitancy to receive the shot.
"The FDA's approval of this vaccine is a milestone as we continue to battle the COVID-19 pandemic," acting FDA Commissioner Janet Woodcock said in a statement. "While this and other vaccines have met the FDA's rigorous, scientific standards for emergency use authorization, as the first FDA-approved COVID-19 vaccine, the public can be very confident that this vaccine meets the high standards for safety, effectiveness and manufacturing quality the FDA requires of an approved product."
Pfizer and BioNTech's Comirnaty secured FDA emergency use authorization in December 2020 for people ages 16 and older before being expanded to ages 12 and older in May.
"While millions of people have already safely received COVID-19 vaccines, we recognize that for some, the FDA approval of a vaccine may now instill additional confidence to get vaccinated," Woodcock said. "Today's milestone puts us one step closer to altering the course of this pandemic in the U.S."
Pandemic on the rise
Meanwhile, COVID-19 cases in the U.S. continue to rise, which would likely benefit biopharmaceutical companies with vaccines and therapies aimed at COVID-19, RBC Capital Markets analyst Brian Abrahams said in an Aug. 10 report.
"For the biotech sector, we expect continued value provided by companies involved in the vaccine and therapeutics spaces, with a likely increase in attention on more easily administrable antivirals," Abrahams said. "We also expect more revenue pressure in 3Q across detail- and diagnosis-sensitive drugs though this should ease a bit in 4Q, and some transient additional clinical trial/regulatory headwinds."
Article amended at 10:30 a.m. ET on Aug. 24, 2021, to correct a date in the chart of Pfizer’s market performance.