In a November 29 research note, H.C. Wainwright & Co. LLC Healthcare Analysts Robert Burns and Raghuram Selvaraju, Ph.D. commented that as the novel SARSCoV-2 Omicron variant spreads, biotechnology company BioNTech SE's (BNTX:NASDAQ) development partner Pfizer Inc. (PFE:NYSE) claimed that "it could produce a tailor-made vaccine in roughly 100 days."
The H.C. Wainwright & Co. report mentioned that within the last couple of days, the World Health Organization (WHO) officially designated Omicron (B.1.1.529) as a variant of concern (VOC). Since the WHO made its announcement, the Omicron variant has been detected in several additional countries.
The analysts stated that at present only a limited amount of scientific data is available regarding the Omicron variant's transmissibility, disease severity and the effectiveness of existing vaccines in combating the new strain. The WHO reported that it suspects that mutation occurring within Omicron may carry the potential to increase transmission and disease severity.
H.C. Wainwright commented that, "preliminary evidence suggests an increased risk of reinfection with this variant." The research firm added that with the rising concern associated with Omicron, BioNTech expects that it will receive the lab test results for the Omicron variant within two weeks.
The report noted that if the new data gathered for Omicron demonstrates significantly lower vaccine efficacy or resistance to existing vaccines, BioNTech and its partner Pfizer, as well as Moderna Inc. (MRNA:NASDAQ), believe that they would be able to develop a targeted vaccine for use against Omicron within about 100 days.
H.C. Wainwright advised that if this scenario were to occur, then it anticipates that the resulting increased demand for new or updated vaccines would have positive impact on BioNTech's top-line revenue. The analysts commented that they expect the Omicron strain is highly likely to continue its global spread over the coming weeks. H.C. Wainwright stated that it believes that mRNA-based vaccines such as Pfizer/BioNTech's would be more amenable to adaptations to confront new emerging virus strains compared to peptide- or protein-based vaccines.
The report pointed out that late last week, Pfizer and BioNTech announced that the Committee for Medicinal Products for Human Use (CHMP) of the European Medicines Agency (EMA) had issued a positive opinion for COMIRNATY vaccine deployment for children from ages five to eleven years old. H.C. Wainwright advised that it is expected that the European Commission (EC) will issue a final decision on a variation to the Conditional Marketing Authorization (CMA) very soon.
The analysts explained that positive data collected in a Phase 2/3 clinical study offer strong support for a positive ruling by the EC. The report mentioned that in the referenced study, "two doses of COMIRNATY 10μg administered 21 days apart resulted in a vaccine efficacy rate of 90.7% in participants without prior SARSCoV-2 infection, measured from 7 days after the second dose, during a period when Delta was the prevalent strain."
H.C. Wainwright also advised that earlier this month, the FDA amended the COMIRNATY's booster dose Emergency Use Authorization (EUA) and approved the booster shot for adults 18 years of age or older. The report listed that the expanded EUA was authorized based upon a randomized Phase 3 trial of more than 10,000 individuals who were administered a 30μg COMIRNATY booster dose.
Importantly, the top-line data from this study applied to participants that were given a booster and previously had completed the two-dose series of COMIRNATY vaccine and that testing was performed at a time when the Delta variant was the prevalent strain. The analysts indicated that in the study, the COMIRNATY booster group demonstrated vaccine efficacy of 95.6%.
H.C. Wainwright stated that from its perspective, broad-based booster deployment is an important key step in the process of achieving and maintaining herd immunity and is an integral part of COMIRNATY's long-term commercial success.
The analysts advised that their valuation methodology for BioNTech is based upon a tiered discounted cash flow (DCF) model employing a 9% discount rate, 3% terminal growth rate and 31% projected effective tax rate. Using these metrics results in a market value of approximately $88.7 billion, or $360/share based on an estimated 246.5 million shares outstanding at the end of Q3/22.
H.C. Wainwright & Co. LLC stated that it is reiterating its "Buy" rating and 12-month price target of $360/share for BioNTech SE. The company's American Depository Receipt (ADR) shares trade on the Nasdaq Exchange under the symbol "BNTX" and last closed for trading at $362.50 on Monday, November 29, 2021.
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A research analyst of the firm and/or the research analyst’s household has a financial interest in and own the securities of BioNTech SE (including, without limitation, any option, right, warrant, future, long or short position).
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