First COVID Oral Antiviral Pill Will Seek FDA Emergency Use — Merck Stock Rises 10% Upon Announcement
Merck (MRK) and Ridgeback Biotherapeutics announced today that their COVID-19 pill — the first oral antiviral of its kind — cut the risk of hospitalizations or deaths by half, and that they would submit an emergency use authorization (EUA) to the Federal Drug Administration (FDA) “as soon as possible.” The news sent stock soaring 10% upon the initial announcement.
“Consistent with Merck’s unwavering commitment to save and improve lives, we will continue to work with regulatory agencies on our applications and do everything we can to bring molnupiravir to patients as quickly as possible,” Robert M. Davis, Merck CEO and president said in a statement. “On behalf of all of us at Merck, I thank our network of clinical investigators and patients for their essential contributions to the development of molnupiravir.”
The drug could be a game changer in controlling the pandemic around the globe: it doesn’t require access to a healthcare facility, as antiviral treatments can be taken at home and could also alleviate the strain on healthcare systems.
“We are very encouraged by the results from the interim analysis and hope molnupiravir, if authorized for use, can make a profound impact in controlling the pandemic,” Wendy Holman, CEO of Ridgeback Biotherapeutics, said in the announcement.
Merck said that in anticipation of the results, it had been producing molnupiravir at risk. The company said it expects to produce 10 million courses of treatment by the end of 2021, with more doses expected to be produced in 2022.
In addition, earlier this year, Merck entered into a procurement agreement with the U.S. Government under which Merck will supply approximately 1.7 million courses of molnupiravir to the U.S. government, upon EUA or approval from the FDA, the company said. Additionally, Merck has entered into supply and purchase agreements for molnupiravir with other governments worldwide, pending regulatory authorization, and is currently in discussions with other governments.
“Merck is committed to providing timely access to molnupiravir globally, if it is authorized or approved, and plans to implement a tiered pricing approach based on World Bank country income criteria to reflect countries’ relative ability to finance their health response to the pandemic,” the company said.
Merck’s stock was up 6% in pre-market trading this morning, and is close to a 10% increase at the time of this publication.
“After swinging and missing on the vaccine front, MRK’s success with molnupiravir could not only unlock over $10 billion in near-term orders, the pill could also represent the best option for bringing the pandemic under control worldwide,” SVB Leerink analyst Daina Graybosch said, according to The Street.
Cantor Fitzgerald analyst Louise Chen reiterated an Overweight rating and a $107.00 per share price target on the stock hearing “clearly good news,” according to Street Insider.
“With the virus continuing to circulate widely, and because therapeutic options currently available are infused and/or require access to a healthcare facility, antiviral treatments that can be taken at home to keep people with COVID-19 out of the hospital are critically needed. Additionally, based on the participants with available viral sequencing data (~40% of participants), molnupiravir demonstrated consistent efficacy across viral variants Gamma, Delta, and Mu,” Chen said in a note, Street Insider reports.
Read: Powell ‘Frustrated’ That COVID-19 Vaccines and Supply Shortages Likely To Push Inflation Into 2022
Government Shutdown Averted: Biden Signs Funding Bill
Earlier this week, CFRA Research reiterated its Buy rating following second quarter results, according to a note sent to GOBankingRates.
“We think MRK is in the midst of a transformation with the Organon spin-off (women’s health, legacy brands, and biosimilars), which took place in June, and leadership change, as the long-tenured CEO K. Frazier retired and was replaced by the CFO, R. Davis,” CFRA analysts said. “We welcome MRK’s decision to spin off Organon into a new company, enabling faster growth and greater focus on key growth drivers. Based on our estimates, Organon amounted to 14% of 2020 Merck’s revenues and the transaction is expected to generate $1.5 billion in operating efficiency by 2024,” they added.
More From GOBankingRates
- 5 Things Most Americans Don't Know About Social Security
- The Secrets Behind These 10 Popular Costco Products
- Social Security Benefits Might Get Cut Early -- What Does It Mean for You?
- When Social Security Runs Out: What the Program Will Look Like in 2035
Last updated: October 1, 2021