Gilead's Covid-19 Treatment Likely to Get Approval; Markets Shift Higher
U.S. stocks rose across the board by midday on news that Gilead Sciences' (Nasdaq: GILD) Phase 3 trials for a drug to treat severe cases of Covid-19 has reached its primary endpoint.
In a statement today, the California-based biotech company said the drug, remdesivir, is similarly effective when it's given over just five days compared with 10.
"These study results complement data from the placebo-controlled study of remdesivir conducted by the National Institute for Allergy and Infectious Diseases and help to determine the optimal duration of treatment with remdesivir," Merdad Parsey, the chief medical officer of Gilead, said in a statement today.
He added, "The study demonstrates the potential for some patients to be treated with a 5-day regimen, which could significantly expand the number of patients who could be treated with our current supply of Remdesivir. This is particularly important in the setting of a pandemic, to help hospitals and healthcare workers treat more patients in urgent need of care."
The announcement sent Gilead's stock nearly 5% higher to $82.25 per share by midday.
The Dow Jones rose 2% to 24,585.19 points, while the S&P 500 gained more than 65 points to 2,928.77 by midday.
Last week, the World Health Organization published a Chinese study that showed remdesivir was ineffective, but then removed the report. The Chinese study claimed the drug failed to reduce the amount of virus in patient's bodies and did not help those severely ill avoid death. In response, Gilead called the assessment an "inappropriate characterization."
According to Jefferies healthcare strategist Jared Holz, remdesivir will likely be approved for use in certain settings.
Some other vaccine stocks to watch are Moderna Inc. (Nasdaq: MRNA) and Tianjin-headquartered CanSino Biologics Inc. (HKEX: 6185). We've recommended a buy on Moderna when it was trading at $27 per share in March; this week, it has hit a high of $51.70 per share.
The coronavirus has so far infected more than 3 million people globally and has claimed almost 220,000 lives.