U.S. drugmaker Pfizer Inc. (PFE) finalized a plan to develop a coronavirus vaccine in partnership with German drugmaker BioNTech SE (BNTX) with the target of jointly producing millions of vaccines by the end of 2020.
Under the terms of the partnership, Pfizer will pay BioNTech $185 million upfront to develop the vaccine including an equity investment of about $113 million, with additional payments if certain milestones are achieved that could take its total investment to nearly $750 million, the two companies said in a joint statement.
They plan to start clinical trials of the vaccine as early as the end of this month, subject to regulatory clearance. Development of the potential drug will commence in the U.S. and Europe and then across multiple sites, they said. Pfizer will help manufacture any potential drug product and said it aims to produce hundreds of millions of vaccines next year.
Moreover, Pfizer and BioNTech will share development costs equally. Initially, Pfizer will fund 100% of the development costs, and BioNTech will repay Pfizer its 50% share of these costs during the commercialization of the vaccine.
In a separate statement, Pfizer said that the drugmaker was also looking into the potential of other drugs that work on the immune system to help coronavirus patients.
“We are committed to making the impossible possible,” said Dr. Albert Bourla, Pfizer Chairman and CEO. “We are facing this public health challenge head on by collaborating with industry partners and academic institutions to develop potential novel approaches to prevent and treat COVID-19. Our researchers and scientists also have been exploring potential new uses of existing medicines in Pfizer’s portfolio to help infected patients globally. We are leaving no stone unturned as we explore every option to help provide society with a treatment or cure.”
As part of the initiative, Pfizer said it plans to support studies to determine whether existing Pfizer medicines, including its rheumatoid arthritis drug Xeljanz, may offer a solution for those infected with the COVID-19 respiratory illness caused by the coronavirus.
TipRanks data shows that Wall Street analysts have a Moderate Buy consensus rating for both Pfizer and BioNtech. Both ratings are evenly divided between 3 Buys and 3 Holds . The $42.55 average price target for Pfizer projects 20% upside potential for the drugmaker’s shares in the coming 12 months. (See Pfizer stock analysis on TipRanks).
While for BioNTech, analysts forecast 15% downside potential setting the average price target at $38.40. (See BioNTech stock analysis on TipRanks).
Gilead’s Experimental Coronavirus Drug Shows “Hopeful” Signs in Small Group
Microsoft’s Bill Gates to Spend Billions of Dollars on Coronavirus Vaccine Development
Google, Apple Join Forces to Develop Coronavirus Tracking Technology