Are these 2 pharma stocks good buy for long term growth?

Highlights

  • Synairgen’s Phase III clinical trial for inhaled interferon beta-1a treatment (SNG001) for COVID-19 patients is progressing well.
  • WHO recommended the global rollout of the world’s first malaria vaccine, RTS, S or Mosquirix, developed by GlaxoSmithKline.

Investing in pharmaceutical stocks is a growing trend, especially in times of political or economic uncertainty. For instance, during the Covid-19 crisis, pharmaceutical firms were in high demand as they offered medicines, products, and equipment needed to tackle the disease spread. This, in turn, increased their share price and value. Pharmaceutical firms register a huge surge in sales after gaining approvals from governments for their products. These firms basically focus on researching, discovering, developing, producing and distributing pharmaceutical products, such as therapies, drugs, and vaccines.

Below is a review of the investment prospect in two pharma stocks – Synairgen and GlaxoSmithKline.

 Synairgen & GSK: Share price and market capitalisation

(Data source: Refinitiv)

Synairgen Plc (LON: SNG)

Synairgen is a company engaged in drug discovery and development for the treatment of respiratory diseases. Recently, Synairgen announced that the company’s Phase III clinical trial for the inhaled interferon beta-1a treatment (SNG001) for non-hospitalised COVID-19 patients is progressing well.

The shares of Synairgen are currently trading at GBX 150.00, down by 1.51% in early trade at 08:21 AM on 8 October 2021. The company’s market cap currently stands at £306.64 million.

Synairgen’s recorded loss before tax of £38.89 million for the six months ended 30 June 2021 compared to a loss of £5.07 million in the previous year. Its research and development expenditure for the period was £36.91 million compared to £4.47 million in the same period in 2020. Its research and development tax credit rose from £1.11 million to £5.97 million due to an increase in the qualifying activities.

GlaxoSmithKline Plc (LON: GSK)

GlaxoSmithKline is an FTSE 100 listed multinational healthcare and pharmaceutical firm. Yesterday, the World Health Organization (WHO) recommended the global rollout of the world’s first malaria vaccine, RTS, S or Mosquirix, developed by GlaxoSmithKline. The vaccine was undergoing clinical trials and tests for several years with support from the Bill and Melinda Gates Foundation and PATH, a US-based global health company. 

The shares of GlaxoSmithKline are currently trading at GBX 1,403.40, up by 0.19% in early trade at 08:36 AM on 8 October 2021. The company’s market cap currently stands at £70,484.67 million.

In August 2021, GlaxoSmithKline and SK Bioscience announced the commencement of Phase 3 clinical study of SK's COVID-19 vaccine candidate, GBP510.

GlaxoSmithKline announced a dividend of 19 pence per share to shareholders for Q2 2021. For Q2 2021, the company’s pharmaceuticals, vaccines and consumer healthcare business sales were £4.2 billion, £1.6 billion and £2.3 billion, respectively. Its total operating profit from the quarter was £1,675 million.

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