The global landscape is fraught with simmering tensions, but one universal commonality remains intact: the need for a coronavirus vaccine.
However, Canaccord analyst John Newman believes that until a vaccine becomes available, there could be another solution. And one just as potent.
“Regeneron’s (REGN) REGN-COV2 antibody cocktail could provide immediate treatment for COVID-19 patients, whereas a vaccine would not. We believe REGN-COV2 is a much-needed approach to provide both immediate impact and a supplement to protection once vaccines are (hopefully) available,” said the 5-star analyst.
Regeneron initiated the Phase 3 study for REGN-COV2 in July, evaluating its efficacy in treating and preventing COVID-19. Initial data from the trial could become available by the end of September, ahead of vaccine data.
Newman argues that what differentiates REGN-COV2 from vaccines is its potential to actually treat active COVID-19. Additionally, before a vaccine becomes widely available, REGN-COV2 could also be used to prevent infection, thereby protecting those most at risk such as front-line workers and elderly patients.
“Even after the availability of a vaccine,” Newman adds, “REGN-COV2 could supplement protection for those not developing an antibody response and help limit pressure on hospital systems.”
The Phase 3 trial is evaluating REGN-COV2’s ability to prevent infection in subjects who have been in close proximity to a COVID-19 patient. When initial REGN-COV2 results are presented, Newman says he will be specifically looking out for data regarding this issue as “this could be informative for long-term care and nursing home settings most vulnerable to COVID-19, as well as hospital settings where workers are constantly exposed.”
Newman expects Regeneron to produce hundreds of thousands of doses per month for prevention, and tens of thousands of doses a month to treat active disease. The company could produce even more if other companies offer Regeneron their manufacturing capabilities.
To this end, Newman rates REGN a Buy along with a $700 price target, which implies a 14% upside potential from current levels. (To watch Newman’s track record, click here)
The Regeneron bulls currently have a slight edge among Wall Street analysts. The stock has a Moderate Buy consensus rating based on 10 Buys and 8 Holds. At $650.94, the average price target puts the 12-month upside potential at 6%. (See Regeneron stock analysis on TipRanks)
Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
