November 8th, 2021 | 12:08 CET
BioNTech, Moderna, Cardiol Therapeutics, Valneva: COVID-19, the vaccination chaos is perfect!
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Born in Munich, he first studied economics and graduated in business administration at the Ludwig-Maximilians-University in 1995. As he was involved with the stock market at a very early stage, he now has more than 30 years of experience in the capital markets.
BioNTech and Moderna - Share price collapse due to wild rumors and whistleblowers
The two top dogs in the vaccine business saw a sell-off on Friday. The reason is that serious allegations have been made against a subcontractor of Pfizer commissioned with clinical studies on the Corona vaccine. As the renowned journal "British Medical Journal" (BMJ) reported regarding an ex-employee of Ventavia, the Company from the US state of Texas is alleged to have falsified data in studies on the vaccine from BioNTech/Pfizer and to have slopped in the tracking of side effects.
The BMJ report is based largely on testimony from former Ventavia employee Brook Jackson. She was involved in the Company's clinical trials of the Corona vaccine for two weeks before she was fired. Among other things, Jackson, a whistleblower, accuses Ventavia of failing to implement the so-called double-blind procedure involving placebos. The aim of this is to enable the most objective possible evaluation of the study results. Allegedly, the FDA has already been informed about this deficiency but did not want to comment on the matter when asked.
It also fits into the opaque situation that Moderna announced weak figures last week. The partner company of BionNTech Pfizer is said to have developed its own drug for oral administration against COVID-19. On Friday, there were also rumors about the alleged arrest of Pfizer CEO Albert Bourla in Canada, which quickly turned out to be a false spread.
But this could not help the prices of BioNTech and Moderna at the end of last week. Both values said goodbye with a decline of more than 20% into the weekend. USD 35 billion shareholder capital dissolved into thin air within 24 hours. If the last analyst estimates are still valid, BioNTech is now trading at a P/E of only 6.5 and Moderna at 11.5. The shares have rarely been this cheap. Nevertheless, we wait and see how the news develops.
Cardiol Therapeutics - Capital increase for clinical studies
It happens again and again that rapidly growing companies resort to capital increases with certain price dynamics. At this moment, the medium-term investor realizes that a stock market listing is equivalent to the original idea of financing growth and does not have to be centrally in line with investor interests. So if good prospects often drive up share prices, even irrationally, it is only fitting that a company's founders and board members should seize the opportunity to raise additional equity capital for the Company.
In Germany, existing shareholders are protected from dilution by the so-called subscription right if they subscribe per the allotted right. In Anglo-Saxon countries, the possibility also exists for larger capital measures with the waiver of the rights of the existing shareholders. In the case of Cardiol Therapeutics Inc., this approach has happened twice now in 2021. Looking at the chart, it is easy to miss the timing because there was a sharp rise in the share price in the run-up to a corporate action each time.
At least the actions at Cardiol are happening in a very positive corporate development environment. The Canadian Department of Health Canada has granted the Company approval to continue work on its Phase II study to evaluate the safety and tolerability of CardiolRx and its effects on myocardial regeneration in patients with acute myocarditis. This approval follows the release of the investigational new drug (IND) application to initiate this study by the US Food and Drug Administration (FDA), which the Company announced on August 24, 2021.
Looking at the positive performance of the share since its launch in Germany, the overall valuation is still positive: CRDL shares have gained 11% since January and have raised a total of USD 72 million in new capital. It means that the financing of the promising pipeline is secured until well into 2022. In addition, the Nasdaq listing contributed to significant attention in recent months, causing the share price to explode to over CAD 6 on the Canadian home exchange. This move could be repeated in the coming months if the Company delivers accordingly.
Valneva - When is the conventional COVID-19 vaccine coming?
In the heated vaccination debate, reports of allegedly flawed approval processes and recurring rumors about the big commercial winners of the global vaccination campaign are not exactly confidence boosters for many people. The share of the French biotech company Valneva therefore continues to be the focus of interest. Especially in Germany, there is a justified interest in alternatives to the well-known mRNA vaccines due to the restrained vaccination rate. The reemerging situation in the COVID-19 pandemic across Europe is additionally driving the issue.
Valneva is a French biotech company headquartered in Saint-Herblain. The Company was formed by the merger of France's Vivalis with Austria's Intercell. It develops and markets vaccines against infectious diseases and has manufacturing facilities in Austria, Scotland and Sweden, as well as subsidiaries in France, Canada and the United States. Valneva, with its VLA2001 inactivated vaccine, is certainly seen by many as something of a beacon of hope in the pandemic; prominent soccer player Joshua Kimmich had also recently made a public statement as a wait-and-see candidate.
Valneva is a highly ambitious "second mover" within the vaccine sector, and the share price jumps back and forth just as volatile with each new announcement. Analytically, the share is not cheap with a capitalization of EUR 1.8 billion and can therefore be described as highly speculative. It will remain a plaything of the current news situation until its approval is granted.
Investment in bio-pharma stocks is currently characterized by high volatility. With the new infection figures, the fantasy for stock market valuations goes into the next round. The last trading days show that there can be some surprises. Cardiol Therapeutics is doing well with its therapy field in cardiovascular diseases, an issue that costs the lives of 30% of humanity every year.
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