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August 16th, 2023 | 05:40 CEST

BioNTech, Defence Therapeutics, Bayer - Who will have trend-setting news first?

  • Biotechnology
  • Pharma
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Pharmaceutical and biotech stocks are among the most volatile sectors in the financial markets. Single news stories about new developments or product announcements can not only cause short-term price swings but also have long-term implications, increasing both risk and opportunity for investors. If a breakthrough drug is developed, old preparations can become obsolete - this is good for the innovative company but detrimental to established market participants. As an investor, it is advisable to select specific companies and anticipate directional news through some research.

time to read: 4 minutes | Author: Armin Schulz

Table of contents:

    BioNTech - Proceedings started after CureVac lawsuit

    On August 15, the trial of CureVac against BioNTech started in Düsseldorf. The Tuebingen-based company accuses the Mainz-based company of patent infringement in its blockbuster Comirnaty vaccine. The verdict in the trial is not expected before October. In the US, Promosome, a biotech company, had also filed suit. If BioNTech loses the lawsuits, retroactive royalties will have to be paid. Not without reason, James Ryan has been added to the board of directors. He will be the Chief Legal Officer and will be responsible for all legal issues.

    On August 7, the Company announced that total revenue in Q2 was EUR 167.7 million, down from EUR 3,196.5 million a year earlier, due to write-downs by partner Pfizer. The cost of sales decreased to EUR 162.9 million, related to declining sales of COVID-19 vaccines. Despite reduced R&D expenses of EUR 373.4 million, the Company posted a net loss of EUR 190.4 million, compared to net income of EUR 1.67 billion in Q2 2022. But more important than the numbers was an update on research where there has been significant progress.

    A pivotal Phase III study for BNT316/ONC-392 was initiated, accompanied by the preparation of several planned studies in oncology. Positive data updates relate to several product candidates. The market launch of the monovalent COVID-19 vaccine adapted to Omicron XBB.1.5 is imminentonce approval by health authorities such as FDA and EMA has been obtained. Planned shipments could begin as early as September. As an investor, patience is needed; the product pipeline is well-filled, but the numbers could be better. Currently, the stock is trading at EUR 97.18.

    Defence Therapeutics

    The Canadian biotechnology company Defence Therapeutics (Defence) has developed the Accum™ technology, which enables the targeted delivery of drugs and vaccines into cells. This approach offers high scalability possibilities. Drugs that, due to biological conditions, have not previously reached the places where they would have been useful can be given a new chance with the Accum™ platform. The potential of Accum™ has also been recognized by Orano, a specialist in nuclear medicine, who entered into a cooperation with Defence. July 18 has already seen the achievement of initial milestones for developing radio-immunoconjugates using intracellular targeting technology.

    CEO Sebastien Plouffe said, "We are pleased to be on schedule with our collaboration agreement with Orano to develop the first therapy using radioimmunoconjugates based on the Auger electron emitter. We are confident we can develop first-in-class radiotherapy with improved efficacy...". By 2028, the radiopharmaceuticals market is expected to grow to USD 13.818 billion, representing a compound annual growth rate of 9.0%. In parallel, the cancer immunotherapy market is expected to reach USD 196.45 billion by 2030, growing at an average annual rate of 7.2%.

    In parallel with the Orano collaboration, the Company plans to launch two Phase I oncology studies. One is to test the AccuTOX™ chemotherapy drug, and the other is to test the ARM vaccine against established tumors. Also, the comparative study is still ongoing, combining Accum™ with an mRNA vaccine and comparing that combination to the results of the mRNA-only vaccine. So there is some news coming up in the weeks and months ahead. Those who want to learn more about the Company should take a look at the Interview at The share, which shot up to CAD 4.85 at the beginning of the year, has since consolidated and can be bought for CAD 2.93.

    Bayer - Lowers forecast

    Bayer reported a decline in sales and profits in Q2, mainly due to falling demand and low prices for glyphosate. Group sales fell 8.2% to EUR 11.0 billion, while adjusted EBITDA declined 24.5% to EUR 2.5 billion. Net loss was EUR 1.9 billion, impacted by impairment charges of EUR 2.3 billion on the glyphosate and other crop protection businesses. The Company lowered its full-year 2023 guidance and now expects consolidated sales of EUR 42 billion to EUR 43 billion and adjusted EBITDA of EUR 9 billion to EUR 9.5 billion.

    So the new CEO Bill Anderson has a lot of work ahead of him and must ask himself once again whether it would not be best for the Group to spin off the Crop Science division. Then the legal disputes would be outsourced, and the Pharma division would no longer suffer from the negative news. Rumors about this had recently resurfaced. In the Pharma division, patent protection for the two blockbusters, Xarelto and Eylea, expires in 2024 and 2025, respectively. For the latter, Sandoz has developed a biosimilar, which recently presented excellent study results.

    Sales are expected to decline there. But Bayer has successor candidates in its portfolio. If management actually decides on a split, that could give the stock a sustained boost. Despite the weak figures, most analysts are optimistic about the share, which is currently trading at around EUR 51.82. The price targets of the analysts who recommend buying are between EUR 65 and EUR 90. The analysts who recommend holding are much more cautious, at EUR 55 to 57.

    The example of BioNTech shows how quickly things can happen in the healthcare sector. One breakthrough and you can earn billions of euros. Those who jumped on the bandwagon too late are probably sitting on losses today. Defence Therapeutics is still in its infancy, but initial results are promising. The first Phase I studies will begin this year, and with the renowned cooperation partner, an important initial step has been taken. Bayer, on the other hand, is a group with various business segments. As a result, it is more diversified, and there are fewer fluctuations. If the Group were to split, this would likely be a great opportunity for shareholders.

    Conflict of interest

    Pursuant to §85 of the German Securities Trading Act (WpHG), we point out that Apaton Finance GmbH as well as partners, authors or employees of Apaton Finance GmbH (hereinafter referred to as "Relevant Persons") may hold shares or other financial instruments of the aforementioned companies in the future or may bet on rising or falling prices and thus a conflict of interest may arise in the future. The Relevant Persons reserve the right to buy or sell shares or other financial instruments of the Company at any time (hereinafter each a "Transaction"). Transactions may, under certain circumstances, influence the respective price of the shares or other financial instruments of the Company.

    In addition, Apaton Finance GmbH is active in the context of the preparation and publication of the reporting in paid contractual relationships.

    For this reason, there is a concrete conflict of interest.

    The above information on existing conflicts of interest applies to all types and forms of publication used by Apaton Finance GmbH for publications on companies.

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    Der Autor

    Armin Schulz

    Born in Mönchengladbach, he studied business administration in the Netherlands. In the course of his studies he came into contact with the stock exchange for the first time. He has more than 25 years of experience in stock market business.

    About the author

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