BioNTech SE – ADR (NASDAQ: BNTX) is making a run for the top in the market this morning, trading on gains of more than 45% in the premarket hours. The gains come after the company issued two COVID-19 related press releases. The first announced the company’s work in the space and the second had to do with a partnership in China. Here’s what’s going on:
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BNTX Stock Soars On Coronavirus Entrance
Joining a long list of biotechnology companies, BioNTech is the next to see dramatic gains as a result of work on a coronavirus vaccine. The company announced that it has developed a new candidate called BNT162 as a potential first-in-class mRNA vaccine for COVID-19.
Importantly, BNTX said that it expects to initiate testing of the candidate in late April of this year. The company also said that it has ben in ongoing discussions with pharma companies, and research bodies to bring this vaccine to the public as quickly as possible.
In the first press release, the company briefly touched on a partnership it created with Fosun Pharma, a Chinese company. The partnership surrounds the development of the vaccine in China, the center of the epidemic.
In a statement, Ugur Sahin, M.D., CEO at BNTX, had the following to offer:
We feel a duty to exploit our full technology and immunotherapy expertise to help address the COVID-19 pandemic emergency. We are working closely together with regulatory agencies and our existing collaborators in the infectious disease field, including Pfizer, to rapidly initiate trials in order to make a vaccine available to the public as quickly as possible worldwide. In addition, we are working on a novel therapeutics approach for those patients who have already been infected – we plan to disclose more on that effort in the coming weeks.
A Deeper Dive Into The Partnership
In the second press release, BioNTech gave investors more information on the strategic alliance with Fosun Pharma. As part of the alliance, the two companies will work together to conduct clinical trials in China. Importantly, the partnership gives BNTX the opportunity to leverage Fosun Pharma’s extensive clinical development, regulatory, and commercial capabilities across China.
If all goes well and the vaccine is approved, Fosun Pharma will commercialize the vaccine in China. BNTX will be in charge of supplying the mRNA vaccine for clinical trials from GMP manufacturing facilities in Europe. Moreover, BioNTech will retain full rights to develop and commercialize the vaccine candidate outside of China.
The agreement between the two companies also includes an investment. In fact, Fosun has agreed to purchase 1,580,777 ordinary shares of BNTX at a total price of $50 million.
In a statement, Ugur Sahin, M.D., had the following to offer:
We see this collaboration as an important step in our global effort to expedite the development of our mRNA vaccine to prevent COVID-19 infection. Fosun Pharma shares our commitment to move rapidly to address the COVID-19 outbreak and brings deep development experience and an extensive network in the pharmaceutical market in Chin.
Why This News Is So Exciting
First and foremost, if you’ve been following the market lately, you know that few stocks have done well. In fact, only coronavirus-related equities seem to be making any headway in today’s market. Considering this, the fact that the company announced that it’s working on a vaccine for COVID-19 is exciting for BioNTech and its investors as it opens the doors to potential gains in a time when the market is a sea of red.
However, the excitement goes further than that. While several companies have announced that they are working on a vaccine, BNTX is one in a small group that already have something tangible, making it one of the leaders in this race.
Furthermore, the partnership with Fosun is a big deal. After all, this outbreak started in China. So, partnering with a large biotechnology company in China gives BNTX a strategic advantage over much of its competition. After all, with a Chinese partner, getting through the regulatory and commercialization process in the country is going to be a much simpler process.
All in all, investors have good reason to be excited here.
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