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Moderna Inches Closer to Coronavirus Vaccine: ETFs to Shine

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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 once again shown progress.  According to data published in the New England Journal of Medicine, Moderna’s potential coronavirus vaccine candidate resulted in a “robust” immune response in all participants in its early stage human trial, per a CNBC article. Accordingly, the company’s shares soared 16% in after-trading hours on Jul 14.

Per the sources, all the 45 patients in the trial were administered a 25, 100 or 250 microgram dose along with 15 people in each dose group. Notably, all the participants were given two doses of Moderna’s potential coronavirus vaccine. Going by the data, all the 45 patients produced neutralizing antibodies with those in the high dose group witnessing four times higher levels of neutralizing antibodies than in recovered COVID-19 patients.

In this regard, Moderna’s chief medical officer, Tal Zaks said that “these Phase 1 data demonstrate that vaccination with mRNA-1273 elicits a robust immune response across all dose levels and clearly support the choice of 100 µg in a prime and boost regimen as the optimal dose for the Phase 3 study” (per a CNBC article). The company now plans to begin the Phase 3 study of mRNA-1273 this month.

Moderna also recently informed about a manufacturing agreement with pan-European pharmaceutical company, Laboratorios Farmacéuticos Rovi, S.A. (Rovi) for manufacturing its coronavirus vaccine candidate for markets outside the United States. The company has also entered into a similar agreement with Catalent (CTLT) for large-scale, commercial fill-finish manufacturing of mRNA-1273 for the United States. Catalent will also be responsible for providing clinical supply services, including support for Moderna’s phase III study on this candidate.

Moderna also recently updated that it is 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.

Race to Vaccine Heats Up

Positive update on coronavirus vaccines made by Pfizer (PFE - Free Report) in collaboration with German biotech firm BioNTech was recently announced. Two out of four of the company’s coronavirus vaccine candidates, BNT162b1 and BNT162b2, have been granted the ‘fast track’ designation by the FDA. The fast-track status will speed up the review process of Pfizer’s coronavirus vaccines.

Pfizer and BioNTech are aiming to start a large trial by later this month if they receive regulatory approval. It is worth noting here that Pfizer is targeting to produce up to 100 million doses by the end of this year and more than 1.2 billion doses by 2021-end, if the vaccine is approved.

In the race to develop coronavirus vaccine, Novovax, Inc. (NVAX) was recently funded $1.6 billion by the federal government to support the late-stage development of its coronavirus vaccine candidate, NVX-CoV2373. The funding will also help the company establish large-scale manufacturing and deliver 100 million doses of NVX-CoV2373, as early as late 2020. Meanwhile, GlaxoSmithKline plc (GSK) and privately-held Medicago have come together to develop and evaluate a coronavirus candidate vaccine. The vaccine candidate will be produced using Medicago’s recombinant Coronavirus Virus-Like Particles and Glaxo’s pandemic adjuvant system. Medicago’s CoVLP technology will be used to develop a vaccine, which will mimic the structure of the virus responsible for COVID-19.

Going on, Vaxart, Inc.’s (VXRT) oral COVID-19 vaccine candidate has been picked for investigation in a non-human primate challenge study. The new study will be organized and funded by Operation Warp Speed (“OWS”), which is a new national program to provide substantial quantities of a safe, effective vaccine to Americans by January 2021. Notably, the five shortlisted companies under the OWS initiative to rapidly develop a coronavirus vaccine are Moderna, Oxford University and AstraZeneca (AZN), J&J (JNJ), Merck (MRCK) and Pfizer, per The New York Times report.

Notably, AstraZeneca, which is developing coronavirus vaccine in collaboration with Oxford University, also expects to begin late-stage studies if the phase I/II study, results from which are expected to be released shortly, is successful.

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 the 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 56 stocks in its basket with Moderna occupying the second spot at 5.75% share. The fund has amassed $37.5 million in its asset base and charges 68 bps in annual fees (read: Expect Further Rally in Nasdaq-100 ETFs as Moderna Joins).

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 5.32% allocation. BTEC charges 42 bps in annual fees and has AUM of $102.8 million (read: Stocks & ETFs Beneficiaries of Coronavirus Vaccine Ramp-Up).

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 5.27% exposure to Moderna. Its AUM is $519 million and it has an expense ratio of 0.35% (read: Biotech ETFs to Shine on Pfizer's Coronavirus Vaccine Progress).

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 4.6%. It has AUM of $129 million and an expense ratio of 0.47% (read: Invest in the Future With Megatrend ETFs).

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 30 stocks in its basket, it has around 3.8% exposure to Moderna. The fund has AUM of $41.7 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 $9.99 billion with an expense ratio of 0.47% (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 $6.19 billion and an expense ratio of 0.35% (read: Top-Ranked ETFs That Crushed the Market in 1H).

First Trust Amex Biotechnology Index (FBT - Free Report)

The fund measures the performance of a cross section of companies in the biotechnology industry that are primarily involved in the use of biological processes to develop products or provide services. It holds about 31 securities in its basket. Its AUM is around $2.23 billion (read: How Are Biotech ETFs Reacting to Coronavirus Treatment News?).

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