Well, here we (maybe) go again. A mysterious illness is infecting people across the globe and people and governments are scrambling to formulate a response. Those of us that have been around for a while have seen this scenario play out several times under many names like SARS, Ebola, Swine Flu, Bird Flu, and most recently COVID. Responses to these maladies have ranged from vague indifference to shutting the world down for two years. For savvy investors, however, anytime there is panic running rampant, there are also opportunities for those who know where to look.
Prevention and treatment are two main avenues to consider when looking for stocks that could see an upside from a broad monkeypox outbreak. As the COVID pandemic has taught us, the prevention avenue can be extremely profitable for companies that make vaccines. Two companies working on monkeypox vaccines include GeoVax Labs (NASDAQ: GOVX) and Emergent BioSolutions (NYSE: EBS). GeoVax is working on a vaccine that is based on a technology called modified vaccinia Ankara (MVA) which has demonstrated efficacy and safety. The company is attempting to combine its monkeypox vaccine with the COVID vaccine it is currently in phase 2 trials with that can be used by patients who are immunocompromised.
Emergent Biosolutions offers a one-two punch play on fighting monkeypox. The company has received FDA approval for its smallpox vaccine called ACAM2000, and recently acquired a monkeypox therapeutic antiviral treatment from Chimerix (NASDAQ: CMRX) called Tembexa in a $337.5 million deal. The combination of a proven vaccine and an antiviral treatment may give EBS the inside track to becoming the market leader if monkeypox cases rise dramatically across the world.
On the treatment front, a company to keep an eye on is SIGA Technologies (NASDAQ: SIGA) which makes a treatment for monkeypox called TPOXX. This treatment can be taken either orally, or intravenously for those patients who cannot swallow capsules. The oral version is approved for use in the U.S., Canada, and Europe and SIGA recently received FDA approval for the intravenous version. Another catalyst for SIGA is a recent contract from the Department of Defense to purchase $7.5 million of TPOXX. In addition to monkeypox, TPOXX is approved in Europe for use for cowpox as well as for complications that arise from vaccinations, and several EU nations are currently building stockpiles of the drug.
It is still the very early innings of the monkeypox news so we don’t yet know how serious any outbreaks will become in various parts of the world. As of June 6, 2022, the U.S. Center for Disease Control (CDC) says there are 1,019 confirmed cases of monkeypox across 29 countries. Having a strategy for how to play the news that is yet to come will be beneficial for investors. Adding companies like GeoVax Labs, Emergent Biosolutions, Chimerix, and SIGA Technologies to the watchlist will help prepared investors be ready to move on both the prevention and treatment fronts.
Disclosure: No position. Spotlight Growth has no relationships with any of the companies mentioned in this article and did not receive payment in any form for its creation. This is an opinion article and is not meant to be financial advise. We are not broker-dealers or investment professionals. Please conduct your own due diligence. For more information on our disclosures, please visit: https://spotlightgrowth.com/disclosures/
