The race for a vaccine is unsettling markets and the drug industry.
When biotech company Moderna announced early Monday positive results from a small, preliminary trial of its coronavirus vaccine, the company’s chief medical officer described the news as a “triumphant day for us.”
Moderna’s stock price jumped as much as 30 percent. Its announcement helped lift the stock market and was widely reported by news organizations, including the New York Times.
Nine hours after its initial news release — and after the markets closed — the company announced a stock offering with the aim of raising more than $1 billion to help bankroll vaccine development. That offering had not been mentioned in Moderna’s briefings of investors and journalists that morning, and the company chairman later said it was decided on only that afternoon.
By Tuesday, a backlash was underway. The company had not released any more data, so scientists could not evaluate its claim. The government agency leading the trial, the National Institute of Allergy and Infectious Diseases, had made no comment on the results. And the stock sale stirred concerns about whether the company had sought to jack up the price of its stock offering with the news.
The Moderna episode is a case study in how the coronavirus pandemic and the desperate hunt for treatments and vaccines are shaking up the financial markets and the way that researchers, regulators, drug companies, biotech investors and journalists do their jobs.
Drug companies accustomed to releasing early data to attract investors and satisfy regulators suddenly find themselves accused of revealing too much, or not enough, by a new, broader audience. Journalists may be scolded for hyping early findings, while those who ignore sketchy data may be blamed for missing the news.
Scientists who take the traditional time to gather and analyze their data for publication in mainstream journals are criticized for sitting on lifesaving information. Upstart websites beat the journals and break the usual rules by publishing unvetted studies, some of dubious quality. And President Donald Trump uses his bully pulpit to promote unproven treatments.
“You have these wild swings based on incomplete information,” said David Maris, managing director of Phalanx Investment Partners and a longtime analyst covering the pharmaceutical industry. “It’s a crazy, speculative environment because the pandemic has caused people to want to believe that there’s going to be a miracle cure in a miracle time frame.”
Moderna’s chairman, Noubar Afeyan, defended the decision to open a stock sale hours after releasing limited data. He said the company’s board had been considering an offering before Monday’s announcement but finalized the decision only late in the day.
At the same time, a torrent of information is blasting from medical journals as well as company and university news releases. Articles are posted on so-called preprint websites of studies that have not been peer-reviewed by experts, unlike articles in mainstream medical and science journals. Clinicaltrials.gov, which lists medical studies, showed that 1,673 were underway for COVID-19 as of Saturday.
News outlets are rushing to stay on top of new findings and feed a public hungry for any advances in potential treatments or vaccine candidates that hold promise against the virus. Some news organizations would prefer to maintain traditional practice and ignore early results of medical studies, waiting for peer-reviewed data, but they are also competing to report on the latest studies.
Still, concerns arise routinely about the quality of rapidly posted data and the motivations behind announcements.
Releasing sparse data is not unusual in the biotech world, where companies often present early trial results months before they are published in journals. Publicly traded companies are required to disclose material information that might lead an investor to buy or sell shares.
Moderna said federal researchers who are conducting the trial would be responsible for submitting the data to be reviewed and published.
Maris said he would leave it to regulators to decide if the company had acted inappropriately in not announcing the stock sale sooner and added that investors should have been told earlier that the company was considering a stock offering.
“There’s something wrong with that,” he said.
Moderna, based in Cambridge, Mass., went public in 2018 and has been a favorite of biotech investors, given its focus on the hot area of immuno-oncology and its partnerships with companies such as Merck and AstraZeneca and with the Vaccine Research Center at the National Institute of Allergy and Infectious Diseases.