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Some of the biggest Pharmaceutical companies of the world have pledged investment in billions of dollars for the research and development of a vaccine or a treatment for the covid-19 disease, which has been spreading rapidly all across the globe. In terms of absolute numbers, this has become the largest global pandemic in the last century, and it is clear to everyone that only respite could come from two things 1. Stopping the community transmission of the disease and 2. Identifying the right vaccination/medication.
Some of the already researched vaccines are under clinical trials all across the world, but most big pharmaceutical companies are also under a cash crunch to spend more on research and development of a vaccination that works against covid-19. This unprecedented circumstance has led to some companies, even competitors coming together and supporting each other so that they can pool their resources in developing a remedy against this pandemic. On 14th April 2020, GlaxoSmithKline, a British pharma company announced that it would be collaborating with the French Multinational company Sanofi, for the purpose of combining both monetary and technology resources to develop a COVID-19 vaccine, that can boost people’s immunity in fighting this disease. Let us delve a little further into this announcement.
How will GSK and Sanofi’s coming together help the world?
It has been reported that approximately 70 different kinds of vaccines are presently under development or are going through various clinical trials across the world in a bid to fight covid-19. In this period, an unprecedented move by GSK, to come together with Sanofi, becomes extremely important. It has also been reported that Sanofi on its part will contribute through its COVID-19 antigen S-protein.
GSK will contribute to the partnership with its proven pandemic adjuvant technology. During a pandemic scenario, the use of an adjuvant can be of great significance because it has the ability to minimise the amount of vaccine protein needed per dose, allowing more doses of vaccine to be created and thereby helping to protect more individuals. The synthesis of a protein-based antibody and an adjuvant is well-established and utilised nowadays in a variety of already being used vaccines. In order to improve the inflammatory response, an adjuvant is introduced to certain vaccines, and it has been proven to deliver effective and long-lasting disease protection than the vaccine itself. It may also improve the chances of providing a successful treatment which can be delivered on a greater magnitude.
The two pharma giants have strategized to begin the phase I clinical trials after June in the current year and intend to complete the development needed for accessibility by the month of June during the next year, if successful and subject to regulatory requirements.
The company made this announcement on 14th April, and experts seemed to be impressed with this combined effort of the two companies. Let us see how the shareholders have responded to the London Stock Exchange Market listed GSK’s stock price.
GSK Stock Price Performance
(Source: Thomson Reuters) Daily Chart as on 16-April-2020, before the closing of the London Stock Exchange Market
As on 16th April 2020, at 02:45 P.M (Greenwich Mean Time), by the time of writing this report, the GlaxoSmithKline Plc stock was trading at a price of GBX 1626.00 per stock on the London Stock Exchange market, an increase in the value of 3.57 per cent or GBX 56.00 per stock, as opposed to the price of the stock on the previous trading day, which had been reported to be at GBX 1570.00 per stock. At the time of writing, the company’s stock price has been trading approximately 22.44 per cent above the 52-week low price of GBX 1328.00 per share as on March 16, 2020, and approximately 12.44 per cent below the 52-week high price of the company of GBX 1857.00 per share as on January 24, 2020. The market capitalisation of GlaxoSmithKline Plc has been reported to be at a value of GBP 78.767 billion, with respect to the current trading price of the company’s share.
GlaxoSmithKline Plc's share has been reported to have gained around 4.58 per cent in value in the last twelve months since April 16, 2019, when the company’s stock was trading at a price of GBX 1554.80 per share at the time of the closing of the markets. The share of GlaxoSmithKline Plc has reportedly risen by around 16.03 per cent over the last one month from the share price of GBX 1401.40 per share set by the company on March 16, 2020. At the time of writing, the beta of the firm's stock was recorded at a value of 0.72.
Meanwhile, it’s also interesting to see the response of GSK’s major competitors in the UK, who themselves are involved in a rigorous Research and Development process to develop a vaccine or a treatment process for Covid-19. Undoubtedly, the latest moves of GSK would have a significant impact on the share prices of these companies as well. Below is a comparative share price performance of GSK’s two major competitors in the UK – AstraZeneca Plc and Hikma Pharmaceuticals Plc.
AZN Stock Price Performance
As on 16th April 2020, at 2:50 P.M (Greenwich Mean Time), by the time of writing this report, the AstraZeneca Plc stock was trading at a price of GBX 7792.00 per stock on the London Stock Exchange market, an increase in the value of 2.32 per cent or GBX 177.00 per stock, as opposed to the price of the stock on the previous trading day, which had been reported to be at GBX 7615.00 per stock. The market capitalisation of AstraZeneca Plc has been reported to be at a value of GBP 99.925 billion, with respect to the current trading price of the company’s share.
AstraZeneca Plc's share has been reported to have gained around 27.84 per cent in value in the last twelve months since April 16, 2019, when the company’s stock was trading at a price of GBX 6095.00 per share at the time of the closing of the markets. The share of AstraZeneca Plc was estimated to have risen by around 25.25 per cent over the last one month from the share price of GBX 6221.00 per share set by the company on March 16, 2020. At the time of writing, the beta of the firm's stock was recorded at a value of 0.53.
HIK Stock Price Performance
As on 16th April 2020, at 2:55 P.M (Greenwich Mean Time), by the time of writing this report, the Hikma Pharmaceuticals Plc Stock was trading at a price of GBX 2247.00 per stock on the London Stock Exchange market, an increase in the value of 0.22 per cent or GBX 5.00 per stock, as opposed to the price of the stock on the previous trading day, which had been reported to be at GBX 2242.00 per stock. While this article was being written, the market capitalisation of Hikma Pharmaceuticals Plc has been reported to be at a value of GBP 5.433 billion, with respect to the current trading price of the company’s share.
Hikma Pharmaceuticals Plc's share has been reported to have gained around 29.21 per cent in value in the last twelve months since April 16, 2019, when the company’s stock was trading at a price of GBX 1739.00 per share at the time of the closing of the markets. The share of Hikma Pharmaceuticals Plc was estimated to have risen by around 29.47 per cent over the last one month from the share price of GBX 1735.50 per share set by the company on March 16, 2020. At the time of writing, the beta of the firm's stock was recorded at a value of 0.24.
Comparative Share price chart of AZN and HIK
(Source: Thomson Reuters) Daily Chart as on 16-April-2020, before the closing of the London Stock Exchange Market
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