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Moderna ETFs to Shine on U.S. Contracts for Coronavirus Vaccine
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The first company to start human clinical trials of its coronavirus vaccine candidate in the United States — Moderna (MRNA - Free Report) — has signed a $1.5-billion coronavirus vaccine supply agreement with the U.S. government. The contract has been entered into for the manufacturing and delivery of initial 100 million doses of its potential coronavirus vaccine, mRNA-1273, with the price coming in at nearly $30.50 per person for a two dose course of treatment (per a Reuters article).
The agreement with Moderna also includes incentive payments for timely delivery of the product. It also states that the U.S. government has an option to purchase up to an additional 400 million doses of the potential coronavirus vaccine from Moderna.
The U.S. government has been entering into such deals under its Operation Warp Speed program to purchase hundreds of millions of doses of potential coronavirus vaccines from several companies, according to The Economic Times article. The United States has entered into advanced purchase agreements for potential coronavirus vaccine candidates with Johnson & Johnson (JNJ), AstraZeneca Plc (AZN), Pfizer Inc (PFE) and BioNTech, and Sanofi and GlaxoSmithKline (GSK).
Moderna’s Progress So Far
Moderna, which is developing this vaccine in collaboration with the National Institute of Allergy and Infectious Diseases, has now begun the Phase 3 clinical trial, encompassing 30,000 healthy participants at around 100 research sites in the United States.
The participants in the trial will be given either two 100 microgram doses of the vaccine or a placebo in a gap of around 28 days. Moreover, participants and the investigators will not be informed about who has received the vaccine.
Infectious diseases expert, Dr. Anthony S. Fauci, expects the results from the trial to be out by November or December. He also mentioned that there was a ‘distinct possibility’ that the results may come out earlier, per The Washington Post article. Recently, Moderna also received an additional $472-million funding from the U.S. government’s Biomedical Advanced Research and Development Authority (BARDA), which the company believes will provide support in late-stage clinical development of the vaccine.
Moderna has also informed that it is also on track to deliver 500 million doses of 100 μg dosage of mRNA-1273 per year, which can possibly increase up to 1 billion doses per year, beginning 2021.
Moderna ETFs to Gain
The competition to come up with a vaccine is opening up near-term opportunities, making the biotech sector a prospective space for investments. Therefore, we discuss a few ETFs that provide exposure to Moderna:
ETFMG Treatments Testing and Advancements ETF (GERM - Free Report)
This fund is designed to give direct exposure to biotech companies directly engaged in the testing and treatments of infectious diseases. Focused on advancements with targeted exposure to the forefront of R&D, vaccines, therapies and testing technologies. It holds 57 stocks in its basket, with Moderna occupying the third spot at 5.62% share. The fund has amassed $69.7 million in its asset base and charges 68 bps in annual fees (read: Should You Invest in COVID Themed ETFs?).
Principal Healthcare Innovators Index ETF (BTEC - Free Report)
This fund invests in companies that are leading the charge toward innovative solutions, rather than spending money on marketing and distribution by tracking the Nasdaq Healthcare Innovators Index. It holds 206 stocks in its basket, with Moderna taking the top spot at 5.07%. BTEC charges 42 bps in annual fees and has AUM of $100 million (read: Moderna Turns Red Hot: Biotech ETFs to Bet On).
The underlying MVIS US Listed Biotech 25 Index tracks the overall performance of companies involved in the development and production, marketing and sales of drugs based on genetic analysis and diagnostic equipment. It holds about 24 securities in its basket, with 5.13% exposure to Moderna. Its AUM is $502.1 million and it has an expense ratio of 0.35% (read: How Will Biotech ETFs React to Q2 Earnings Release?).
iShares Genomics Immunology and Healthcare ETF (IDNA - Free Report)
The fund seeks investment results, before fees and expenses, which match the NYSE FactSet Global Genomics and Immuno Biopharma Index. It holds about 46 securities in its basket with Moderna, occupying a weight of 4.44%. It has AUM of $143.5 million and an expense ratio of 0.47% (read: Top-Performing Biotechnology ETFs Amid Coronavirus Outbreak).
This ETF offers exposure to a basket of companies that develop therapies to treat cancer by harnessing the body's own immune system. Holding 31 stocks in its basket, it has around 3.67% exposure to Moderna. The fund has AUM of $39.2 million. The product charges 79 basis points in annual fees (read: Biotech ETFs to Gain From Latest Advancements in Cancer Drugs).
Other broader biotech ETFs that hold companies developing tests, vaccines and therapies for the coronavirus include:
This fund seeks to provide exposure to U.S. biotechnology and pharmaceutical stocks and tracks the Nasdaq Biotechnology Index. It has an AUM of $9.43 billion with an expense ratio of 0.46% (read: 3 Hot Sector ETFs to Tide Over the Coronavirus Crisis in Q3).
The fund seeks daily investment results, before fees and expenses, which match the S&P Biotechnology Select Industry Index. It holds about 133 securities in its basket. It has AUM of $5.64 billion and an expense ratio of 0.35%.
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Moderna ETFs to Shine on U.S. Contracts for Coronavirus Vaccine
The first company to start human clinical trials of its coronavirus vaccine candidate in the United States — Moderna (MRNA - Free Report) — has signed a $1.5-billion coronavirus vaccine supply agreement with the U.S. government. The contract has been entered into for the manufacturing and delivery of initial 100 million doses of its potential coronavirus vaccine, mRNA-1273, with the price coming in at nearly $30.50 per person for a two dose course of treatment (per a Reuters article).
The agreement with Moderna also includes incentive payments for timely delivery of the product. It also states that the U.S. government has an option to purchase up to an additional 400 million doses of the potential coronavirus vaccine from Moderna.
The U.S. government has been entering into such deals under its Operation Warp Speed program to purchase hundreds of millions of doses of potential coronavirus vaccines from several companies, according to The Economic Times article. The United States has entered into advanced purchase agreements for potential coronavirus vaccine candidates with Johnson & Johnson (JNJ), AstraZeneca Plc (AZN), Pfizer Inc (PFE) and BioNTech, and Sanofi and GlaxoSmithKline (GSK).
Moderna’s Progress So Far
Moderna, which is developing this vaccine in collaboration with the National Institute of Allergy and Infectious Diseases, has now begun the Phase 3 clinical trial, encompassing 30,000 healthy participants at around 100 research sites in the United States.
The participants in the trial will be given either two 100 microgram doses of the vaccine or a placebo in a gap of around 28 days. Moreover, participants and the investigators will not be informed about who has received the vaccine.
Infectious diseases expert, Dr. Anthony S. Fauci, expects the results from the trial to be out by November or December. He also mentioned that there was a ‘distinct possibility’ that the results may come out earlier, per The Washington Post article. Recently, Moderna also received an additional $472-million funding from the U.S. government’s Biomedical Advanced Research and Development Authority (BARDA), which the company believes will provide support in late-stage clinical development of the vaccine.
Moderna has also informed that it is also on track to deliver 500 million doses of 100 μg dosage of mRNA-1273 per year, which can possibly increase up to 1 billion doses per year, beginning 2021.
Moderna ETFs to Gain
The competition to come up with a vaccine is opening up near-term opportunities, making the biotech sector a prospective space for investments. Therefore, we discuss a few ETFs that provide exposure to Moderna:
ETFMG Treatments Testing and Advancements ETF (GERM - Free Report)
This fund is designed to give direct exposure to biotech companies directly engaged in the testing and treatments of infectious diseases. Focused on advancements with targeted exposure to the forefront of R&D, vaccines, therapies and testing technologies. It holds 57 stocks in its basket, with Moderna occupying the third spot at 5.62% share. The fund has amassed $69.7 million in its asset base and charges 68 bps in annual fees (read: Should You Invest in COVID Themed ETFs?).
Principal Healthcare Innovators Index ETF (BTEC - Free Report)
This fund invests in companies that are leading the charge toward innovative solutions, rather than spending money on marketing and distribution by tracking the Nasdaq Healthcare Innovators Index. It holds 206 stocks in its basket, with Moderna taking the top spot at 5.07%. BTEC charges 42 bps in annual fees and has AUM of $100 million (read: Moderna Turns Red Hot: Biotech ETFs to Bet On).
VanEck Vectors Biotech ETF (BBH - Free Report)
The underlying MVIS US Listed Biotech 25 Index tracks the overall performance of companies involved in the development and production, marketing and sales of drugs based on genetic analysis and diagnostic equipment. It holds about 24 securities in its basket, with 5.13% exposure to Moderna. Its AUM is $502.1 million and it has an expense ratio of 0.35% (read: How Will Biotech ETFs React to Q2 Earnings Release?).
iShares Genomics Immunology and Healthcare ETF (IDNA - Free Report)
The fund seeks investment results, before fees and expenses, which match the NYSE FactSet Global Genomics and Immuno Biopharma Index. It holds about 46 securities in its basket with Moderna, occupying a weight of 4.44%. It has AUM of $143.5 million and an expense ratio of 0.47% (read: Top-Performing Biotechnology ETFs Amid Coronavirus Outbreak).
The Cancer Immunotherapy ETF (CNCR - Free Report)
This ETF offers exposure to a basket of companies that develop therapies to treat cancer by harnessing the body's own immune system. Holding 31 stocks in its basket, it has around 3.67% exposure to Moderna. The fund has AUM of $39.2 million. The product charges 79 basis points in annual fees (read: Biotech ETFs to Gain From Latest Advancements in Cancer Drugs).
Other broader biotech ETFs that hold companies developing tests, vaccines and therapies for the coronavirus include:
iShares Nasdaq Biotechnology ETF (IBB - Free Report)
This fund seeks to provide exposure to U.S. biotechnology and pharmaceutical stocks and tracks the Nasdaq Biotechnology Index. It has an AUM of $9.43 billion with an expense ratio of 0.46% (read: 3 Hot Sector ETFs to Tide Over the Coronavirus Crisis in Q3).
SPDR S&P Biotech ETF (XBI - Free Report)
The fund seeks daily investment results, before fees and expenses, which match the S&P Biotechnology Select Industry Index. It holds about 133 securities in its basket. It has AUM of $5.64 billion and an expense ratio of 0.35%.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>