AstraZeneca gets $1.2B from U.S. to develop COVID-19 vaccine as Trump tries hydroxychloroquine
Catch up on the top industries and stocks that were impacted, or were predicted to be impacted, by the comments, actions and policies of President Donald Trump and his administration with this weekly recap compiled by The Fly:
1. COVID-19 VACCINE: On Thursday, AstraZeneca stated that it is collaborating with a number of countries and multilateral organizations to make the University of Oxford's COVID-19 vaccine "widely accessible around the world in an equitable manner." The company has concluded the first agreements for at least 400M doses and has secured total manufacturing capacity for one billion doses so far and will begin first deliveries in September 2020.
AstraZeneca also announced that it received support of more than $1B from the U.S. Biomedical Advanced Research and Development Authority for the development, production and delivery of the vaccine, starting in the fall.
On Friday, Reuters reported that the U.S. is planning a "massive testing effort" as a vaccine is sought to fight COVID-19. The plans involve more than 100,000 volunteers and a half dozen or so of "the most promising vaccine candidates" with a goal of finding a safe and effective one by the end of 2020. On the "short list," a Moderna (MRNA) vaccine will be the first to the enter large-scale testing in July, and it could be joined by the vaccine from Oxford University and AstraZeneca, according to Francis Collins, the director of the National Institutes of Health. Vaccines by Johnson & Johnson (JNJ), Sanofi (SNY) and Merck (MRK), which are "a month or two behind the frontrunners," may get added over the course of the summer, the report added.
2. ANTI-MALARIA DRUG: President Trump said that he has been taking anti-malaria drug hydroxychloroquine for more than a week to prevent himself from contracting coronavirus infection, according to CNBC.
On Friday, the Washington Post's Ariana Eunjung Cha and Laurie McGinley reported that a study published in medical journal the Lancet concluded that the anti-malaria drug that President Trump has said that he has been taking has been linked to a significantly higher risk of death and patients taking it were also more likely to develop a type of irregular heart rhythm that can lead to sudden cardiac death.
Mylan (MYL), Teva (TEVA), Novartis (NVS), and Bayer (BAYRY) are among companies that had announced efforts to increase hydroxychloroquine production early in the COVID-19 outbreak.
3. SALES TO HUAWEI: Rosenblatt analyst Ryan Koontz noted in a research note to investors that Lumentum's (LITE) management see the Trump administration's new export blocks on Huawei having no material impacts on their ability to supply Huawei with current products. He also believes there will be "little to no impact" on peer NeoPhotonics' (NPTN) ability to sell current products to Huawei, which he noted accounts for more than 50% of revenues. However, given concerns that the new Department of Commerce rules affect supply of Huawei designed ASICs, the analyst sees increased risk in Huawei demand beginning in the second half of 2020. Koontz believes "the prime administration objective is to impart major damage on Huawei global share in 5G."
Last week, the Bureau of Industry and Security, or BIS, announced plans to protect U.S. national security by restricting Huawei's ability to use U.S. technology and software to design and manufacture its semiconductors abroad. "This announcement cuts off Huawei's efforts to undermine U.S. export controls. BIS is amending its longstanding foreign-produced direct product rule and the Entity List to narrowly and strategically target Huawei's acquisition of semiconductors that are the direct product of certain U.S. software and technology," the Commerce Department announced. Since 2019 when BIS added Huawei Technologies and 114 of its overseas-related affiliates to the Entity List, companies wishing to export U.S. items were required to obtain a license. However, Huawei has continued to use U.S. software and technology to design semiconductors, undermining the national security and foreign policy purposes of the Entity List by commissioning their production in overseas foundries using U.S. equipment.
4. HONG KONG SECURITY LAW: After China signaled it will impose new national-security laws on Hong Kong, dealing a blow to the territory's autonomy as Beijing moves to stop widespread pro-democracy protests that have challenged leader Xi Jinping, U.S. senators are introducing a bipartisan bill that would sanction Chinese party officials and entities who enforce the new national-security laws in Hong Kong, The Wall Street Journal's Lindsay Wise reported. The legislation also would penalize banks that do business with the entities, the report noted.
Hong Kong's Hang Seng index plunged about 5.5% on Friday after China, at its annual National People's Congress, confirmed that there will be a bill establishing "an enforcement mechanism for ensuring national security" for Hong Kong.
"Week in Review" is The Fly's weekly recap of its recurring series of "Trump Effect" exclusive stories.
Keywords: Week in Review, Trump, Trump Effect, Politics, Covid-19, Coronavirus, pandemic, trade, vaccine, drug