BioNTech, XPhyto Therapeutics, MorphoSys - Here we go again

XPhyto - Enormous pace

Last year, after the initial lockdown, people were still hoping for a quick end to the pandemic and a return to a free life as they knew it before Corona. Now, more than a year later, it should be clear to everyone that we have to live with the virus, in whatever variant it currently prevails. The profiteers, as morbid as it may sound, are not only the vaccine producers but also the developers of rapid tests and diagnostics. According to one study, the global market for rapid tests is expected to grow by around 9% annually to a total volume of almost USD 40 billion by 2023.

Well-positioned in this highly competitive market is life science accelerator XPhyto, whose focus is on investing in next-generation drug delivery, diagnostics, and new active pharmaceutical ingredients. In terms of Covid testing, in collaboration with a German partner, sales of the Covid-19 RT-PCR test system "Covid-ID Lab" began in Germany at the end of May. The advantage of the test offered is that Covid-ID Lab requires only a 20-minute PCR run time without prior RNA extraction as part of sample preparation. The product is intended to bridge the gap between single-use antigen tests and centralized, automated PCR systems. Target customers include airports, cruise ships, pharmacies and medical care facilities, and industrial and educational sites where a rapid result is required.

Last week, XPhyto announced a strategically important acquisition for the future. With 3a-diagnostics GmbH, the Company acquired an essential piece of the puzzle for developing diagnostics for a purchase price of EUR 3.7 million. The two companies have been cooperating on a wide range of research topics since the beginning of last year. The focus is on the joint development and commercialization of cost-effective and easy-to-use biosensor screening tests and the associated development platforms for rapidly detecting infectious diseases. The Frickenhausen-based Company was also part of the research on the newly marketed 25-minute PCR test Covid-ID Lab.

XPhyto stands on several pillars and is growing both organically and through targeted acquisitions. The market capitalization is EUR 78.6 million. Due to many projects, the Canadians are an exciting player in the diagnostics market in the long term.

MorphoSys - Thumbs down

Things are not looking good for the chart of the biotech Company MorphoSys. After breaking the critical support line at EUR 55, the share price plummeted with a loss of more than 6% to EUR 51.20, which represents a three-year low. The next stop would be the mark around EUR 50. Should this prominent support be torn, a slide to EUR 40 is quite likely.

The reason for the sell-off was a dramatic reduction in sales targets for the full year 2021, after management already announced in the first quarter that sales could be halved due to very volatile production sales, and MorphoSys could once again post losses. Lower production sales of the cancer drug Monjuvi, which MorphoSys co-markets with Incyte in the US, is now forcing the Company to slash revenues. Sales are expected to reach EUR 155 million to EUR 180 million in 2021, down from previous estimates of up to EUR 200 million.

Furthermore, costs grew more than expected in areas such as research and development and sales. In addition, the high expenses generated by the acquisition of Constellation Pharmaceuticals contributed to the weaker result. Operating expenses would now be EUR 435 million to EUR 465 million, down from a previous estimate of EUR 385 million. Our advice: Hands off!

BioNTech - Good business

At the moment, both the business and the share price of the German vaccine manufacturer BioNTech are developing much more positively. After a new all-time high, the share continues to run without signs of weakness, driven by the news. If you are invested, we recommend stopping under the gap opened last week at around USD 260 and letting the profits run.

Further major orders came from the US last week. Because the government is preparing to vaccinate younger children and possibly necessary booster shots for adults, 200 million doses of BioNTech and Pfizer's Corona vaccine were ordered again, with half to be delivered by the end of the year. That brings the total number to be delivered to the US government by the two companies based on the existing supply agreement to 500 million doses of vaccine, according to BioNTech.

The Coronavirus will be with us for a long time. As different variants form, more vaccines will be developed in the coming years, promising billions more in revenue. In addition to vaccine manufacturers such as BioNTech or Moderna, diagnostics producers or providers of rapid tests such as XPhyto will also profit.