What’s Happening With Johnson & Johnson’s Covid-19 Vaccine?

The rollout of Johnson & Johnson (NYSE:JNJ) Covid-19 vaccine has been off to a rocky start amid concerns of extremely rare but potentially deadly side-effects of blood clots and manufacturing and quality issues at a plant run by a contractor in Baltimore. Demand for the shot has also been tepid in the United States, where Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) have come to dominate the Covid-19 vaccine market. The manufacturing issues, coupled with low uptake have meant that no new doses of the shot have been distributed to states since the week of May 17. ^[1] Moreover, about half of the 21 million doses produced for the United States are apparently unused, per a report from Reuters.

However, J&J is making some progress with its international rollout. The single-dose vaccine was authorized for emergency use by the U.K. regulator in late May and the U.K has ordered 20 million doses of the shot that is likely to be available later this year.  J&J also filed for regulatory approval of the vaccine in Japan, noting that it could begin supplying doses to the country by 2022. Japan has made little progress with its vaccination drive so far, with less than 4% of its population fully vaccinated. The company is also looking to expand the vaccine’s availability to India, working with manufacturer Biological E. to produce its shot locally. Overall, we still think the J&J shot has room for growth globally, as it could do much of the heavy lifting in getting the global population inoculated against Covid-19, considering its single-dose requirement and relatively easy storage.

Now while J&J’s vaccine has dominated the headlines for the company, there is not much upside from a stock price appreciation point of view, given that it is a not-for-profit product, at least for the period of the pandemic. Overall, oncology and immunology drugs will be the key growth driver for J&J in the near term, in our view. Moreover, the end of Covid-19 should also bode well for diversified healthcare companies like Johnson & Johnson, as hospital visits and elective procedures rebound. J&J stock has underperformed the market significantly, rising by just about 12% over the past 12 months, compared to the S&P 500 which is up by about 30% over the same period. We think the stock remains undervalued trading at about 15% below our current price estimate of $195 per share. See our complete analysis on Johnson & Johnson.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[5/17/2021] Does J&J’s Covid-19 Vaccine Still Matter?

Although Johnson & Johnson (NYSE:JNJ) began the rollout of its  Covid-19 vaccine in the United States in early March 2021, it is seeing a very slow deployment. Just about 600k doses were allocated to states for the week of May 10th, compared to over 10 million doses for Pfizer’s shot, and no doses are apparently allocated for this week. The slow rollout comes amid fears of extremely rare but potentially deadly blood clots in patients who received the J&J shot and also due to supply constraints, with a manufacturing facility operated by J&J subcontractor Emergent Biosolutions coming under scrutiny by the U.S. FDA for multiple lapses. Now with about half the U.S population has received at least one shot of a vaccine, and inoculation drives moving to lower age groups with the approval of Pfizer’s shot for adolescents,  the J&J shot seems unlikely to play a major role in the U.S. inoculation drive.

That said, we still think the vaccine has a lot of room for scaling up internationally. The global inoculation drive is still in the early stages, with just about 1.45 billion doses being administered globally per the Bloomberg Vaccine Tracker – enough to fully vaccinate under 10% of the world’s population. We still think the J&J shot could do much of the heavy lifting in getting the global population, particularly in lower-income countries, inoculated against Covid-19,  given its single-dose requirement and relatively easy storage. For instance, South Africa is likely to rely heavily on the J&J shot, while the shot is also likely to be available in India in the coming months. Moreover, most experts think that Covid is likely to become endemic, and vaccine shots could become an annual occurrence, much like flu shots. J&J has indicated that it was studying booster shots and new vaccines that might be needed to tackle evolving variants of the virus. While J&J pledged to sell its Covid vaccine on a not-for-profit basis through the current pandemic, it could potentially turn a profit from new vaccines and booster shots in the future.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[12/4/2020] Johnson & Johnson Vaccine Updates

Johnson & Johnson (NYSE:JNJ) began the rollout of its single-dose Covid-19 vaccine in the United States in early March 2021.  Below are some of the recent updates relating to the vaccine.

The supply of J&J’s Covid-19 vaccine is expected to decline by about 85% in the U.S. this week, as the company faces some manufacturing challenges. Total supply through the U.S. is likely to stand at about 1.5 million doses, down from 11 million for last week. That said, the company says that it is on track to deliver 100 million doses to the United States government by the end of May.

Separately, the European Union’s health agency is investigating reports that a few people developed serious blood clots after receiving J&J’s Covid-19 vaccine in the U.S. However, we think it’s unlikely that this will impact the eventual rollout of the shot which was recently approved for use in the E.U. There have been only four reported cases of serious blood clots. In comparison, J&J shipped about 20 million doses of the shot to the U.S. in March. This likely means that the benefits of the vaccine should outweigh a very small risk of severe adverse effects.

J&J plans to conduct a bridging study for its Covid-19 vaccine in India shortly. Bridging trials are supplementary clinical studies performed in a new country in order to gather data on efficacy, safety, and dose regimen based on the regional demographics. India, which has a population of over 1.3 billion people, is facing a shortage of vaccines just as Covid-19 cases in the country soar. A successful bridging study should enable J&J to deploy its one-dose shot locally.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[4/1/2021] How Is J&J’s Vaccine Rollout Going?

Johnson & Johnson (NYSE:JNJ) began the rollout of its single-dose Covid-19 shot in the U.S. in early March.  Here are some of the recent developments relating to the vaccine.

While Johnson & Johnson beat its March delivery target for the U.S., providing the government with over 20 million doses, a recent error at the plant of a vaccine manufacturing partner, Emergent BioSolutions, apparently contaminated about 15 million doses of the shot. The problem was identified quickly, and none of the doses left the plant. While we think it is likely that the error could impact near-term supply growth for the shot, J&J says that it is on track to deliver 100 million doses to the U.S. by the end of June, or possibly sooner.

Separately, the vaccine received approval from E.U regulators in mid-March and Johnson & Johnson says that it is likely to start delivering doses to the bloc starting from April 19. The E.U has entered into a firm order for 200 million doses of the vaccine, and has an option for 200 million additional doses. The E.U’s vaccination drive has been progressing much slower than expected, and it is likely that the J&J shot will help to speed up inoculation efforts considerably.

Thus far, less than 4% of the global population ((Bloomberg vaccine tracker)) has been vaccinated for Covid-19 and we think that J&J’s shot could play a big role in improving coverage. The shot’s single-dose requirement and the fact that it can be stored at standard refrigerator temperatures of  2 to 8 degrees Celsius should make it much more accessible. J&J plans to produce around one billion doses this year. Although the headline efficacy number for the vaccine (66%) is lower compared to rivals, the shot still provides 100% efficacy against Covid-related hospitalization and death – which is a key endpoint for vaccines.

[3/2/2021] J&J’s Vaccine Is Approved

Johnson & Johnson’s (NYSE:JNJ) single-dose Covid-19 vaccine received emergency use approval from the U.S. FDA late last week, with a rollout expected to begin shortly. So what does this mean for J&J’s stock? Overall, the vaccine isn’t expected to really move the needle for J&J’s bottom line, as it intends to sell the shot at cost through the pandemic. However, J&J’s quick development of a differentiated Covid-19 vaccine should give investors confidence that the company still has the capability to innovate quickly, despite the fact that it isn’t really a major vaccine maker. In contrast, even Merck which has a rich history of vaccine development had to abandon its Covid-19 vaccine program last month citing a weak immune response. Separately, the vaccine should help J&J rebuild its brand image after it faced setbacks amid lawsuits relating to contamination of its baby and other talc products. The end of Covid-19 should also bode well for diversified healthcare companies like Johnson & Johnson, as hospital visits and elective procedures rebound.

Now J&J has about four million doses of the shot ready to ship this week, with a total of 100 million doses expected to be delivered to the U.S. by the end of June, per a contract with the U.S. government. J&J plans to produce around one billion doses by the end of this year. Although the vaccine’s efficacy figure of 72% in U.S. clinical trials is behind Pfizer and Moderna who have shots that are around 95% effective, the J&J shot is 100% effective against hospitalization and death. Also, being a single dose shot, governments can vaccinate populations twice as fast with a given number of doses compared to the other shots on the market. Moreover, this is the first vaccine to be reviewed by the FDA after the two new variants of the novel Coronavirus were discovered.

[2/19/2021] J&J Vaccine Updates

Johnson & Johnson’s (NYSE:JNJ) single-dose Covid-19 vaccine has started to roll-out in South Africa. The shot is being administered as part of a research study that is targeting up to half a million healthcare workers and marks the first time the vaccine is being deployed outside of clinical trials. Earlier this month, South Africa paused the roll-out of AstraZeneca’s vaccine, which was apparently not effective against the Covid-19 strain dominant in the country. The J&J shot, on the other hand, has shown about 57% efficacy in preventing moderate and severe Covid-19 infections in South African trials.

Separately, the U.S. FDA is likely to review the vaccine data on February 26, and it’s likely that the vaccine will be granted emergency authorization by early March with vaccinations potentially starting shortly after that. J&J has a contract with the U.S. government to supply about 100 million doses by the end of June, although initial supplies are reportedly very limited. J&J is also seeking authorization for its shot from the E.U. The European Medicines Agency, the European drug regulator, is expected to issue an opinion on the shot by mid-March.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[2/1/2021] J&J Vaccine’s 66% Efficacy Is Better Than It Looks

Johnson & Johnson (NYSE:JNJ) announced that its single-shot Covid-19 vaccine was 66% effective in preventing moderate and severe cases of Covid-19 in its global phase 3 trials. Efficacy varied by region, with the shot proving 72% effective in the U.S., 66% effective in Latin America, and around 57% effective in South Africa. Although the headline efficacy figures put J&J behind both Moderna and Pfizer, which have vaccines that are over 90% effective in the market, J&J’s shot remains very promising for a couple of reasons. Firstly, the shot only requires a single dose and this should greatly reduce logistical costs and help to vaccinate populations twice as fast with a given number of doses compared to the other shots on the market. This is valuable in the midst of a pandemic. Secondly, the shot has shown complete protection against hospitalization and deaths, 28 days post-vaccination. ^[2]  Moreover, the efficacy figures actually compare quite favorably with some other vaccines. For example, the AstraZeneca Covid vaccine posted an efficacy rate of roughly 62% with the standard two-dose regimen that is currently being used in the U.K. In fact, even annual flu vaccines are typically only around 40% to 60% effective. Additionally, J&J started late-stage trials to evaluate a two-dose regimen of its vaccine, with recruitment likely to be completed by this March. It’s possible that this dosing could offer better efficacy levels.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[1/25/2021] Johnson & Johnson Vaccine Updated

Johnson & Johnson’s (NYSE:JNJ) Covid-19 vaccine is one of the most closely watched shots against the novel coronavirus, given that it is backed by one of the world’s largest pharma companies and is expected to require only a single dose. Here’s a quick rundown of the expected timeline for the vaccine’s launch. Johnson & Johnson is expected to provide data from its phase 3 trial of around 45k participants around the last week of January or the first week of February and file for emergency use approval with the U.S. FDA post that if the results are positive. The process of preparing and filing for an application could take a week or two, after which the FDA review and potential approval is likely to take another two to three weeks. For perspective, the FDA review process took about three weeks for Pfizer and slightly less for Moderna. Considering this, it’s likely that the J&J shot should be approved for use by sometime in March.

This would put the shot at least two to three months behind Pfizer, which received emergency approval from the FDA on December 11, 2020. That being said, there’s plenty of room for the company to scale up as vaccination drives are still in the very early stages. Per the Bloomberg vaccine tracker, only around 66 million people, in the 56 countries being tracked, have been vaccinated. The U.S. has administered 22.4 million doses. ^[3] Moreover, J&J’s shot should see strong demand, given that it is likely to be a one-dose vaccine that is apparently going to be easy to store and distribute, helping to make mass vaccination drives much more straightforward.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[1/15/2021] Johnson & Johnson Vaccine Updates

Johnson & Johnson (NYSE:JNJ) is developing one of the most closely watched Covid-19 vaccines, considering that it is a single-dose shot that should be relatively easy to distribute. Here’s a quick rundown on the recent developments for the vaccine. Based on data from the phase 1/2 trials of 805 participants, published on Wednesday, the vaccine generated a long-lasting immune response with 90% of participants generating neutralizing antibodies against the Coronavirus. ^[4] Based on these early-stage findings the company expects the vaccine to be more than 70% effective, noting that efficacy could reach “very high levels”. For perspective, the Pfizer and Moderna vaccines, which are being rolled out in the U.S. are over 90% effective. More conclusive efficacy data from J&J’s phase 3 study which has 45,000 volunteers is expected in the coming weeks with the company likely to proceed with emergency approval if the results are favorable.

Separately, there have been reports that the company is seeing some manufacturing delays for the vaccine. While J&J was expected to deliver 12 million doses by the end of February and 100 million by the end of June, it has reportedly fallen behind these goals by as much as two months. ^[5] As of last September, the company said that it had plans to deliver over a billion doses by the end of 2021.

[1/6/2021] What’s Happening With Johnson & Johnson’s Covid-19 Vaccine? 

Johnson & Johnson (NYSE:JNJ) is expected to report interim data from the phase 3 trial of its Covid-19 vaccine candidate this month, providing insight into its safety and efficacy. The company has completed enrollment on the trial, with 45,000 people for the trial, below its initial target of 60,000, although this is unlikely to make a difference as higher rates of Coronavirus infections in the U.S. are likely to allow it to gather the data it needs with fewer volunteers. If all goes well, J&J could apply for emergency use approval from the U.S. FDA as early as February. Although J&J is at least two months behind Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) who have already started to roll out their vaccines, J&J’s shot could be much sought after if it proves as safe and effective as rivals, considering that it likely requires only a single dose, unlike rival vaccines which require two shots to be given a few weeks apart.

Overall, the vaccine isn’t expected to really move the needle for J&J financially, as it intends to sell the vaccine at cost through the pandemic. However, the vaccine should help the company rebuild its brand image after it faced setbacks amid lawsuits relating to contamination of its baby and other talc products. Secondly, the end of Covid-19 should bode well for diversified healthcare companies like Johnson and Johnson, as hospital visits and elective procedures rise. The focus could also shift back to the company’s blockbuster drugs, including Stelara, Imbruvica, and Darzalex, which posted about 22% y-o-y growth over the first nine months of 2020.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[Updated 12/7/2020] Covid-19 Vaccine stocks

Johnson & Johnson (NYSE:JNJ) is seen as a key player in the Covid-19 vaccine race. The company started phase 3 trials in September and expects to file for emergency approval by early 2021 if the vaccine is safe and effective. While rivals Pfizer and Moderna’s vaccines will have a head start, given that they have completed phase 3 trials with exceptionally strong results and are likely to start shipping their vaccines in the coming weeks, Johnson & Johnson’s candidate remains promising for a couple of reasons. Firstly, the company is targeting a single-dose regimen for the vaccine, unlike most of the other players which require two doses (although it also started a two-dose regimen to evaluate incremental benefits). This should make it much easier to administer at the time of a pandemic, putting less stress on the healthcare infrastructure. Secondly, the distribution could also be relatively seamless as the vaccine is expected to remain stable for at least three months at refrigerator-like temperatures, unlike some other vaccines (such as Pfizer’s) that need specialized freezers. The vaccine is also likely to be relatively affordable. Per a deal with the U.S. government, Johnson & Johnson has priced its vaccine at about $10 per dose. That’s well below Pfizer’s ($19 per dose) and Moderna ($25 to $37 per dose). Although the vaccine is unlikely to move the needle for the company in the near-term, as it will provide the shots for a not-for-profit basis through the pandemic, it could have an incremental impact post that.

See our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines.

[Updated 11/4/2020] Covid-19 Vaccine stocks

Our indicative theme of Covid-19 Vaccine stocks – which includes a diverse set of U.S.-based pharma and biotech companies developing Covid vaccines – is up by about 560% year-to-date, on an equally weighted basis, compared to the S&P 500 which has gained just about 4% over the same period. While most vaccine stocks declined last week, amid a broader sell-off in the markets, they are likely to come back into the spotlight as efficacy data from late-stage trials is expected from frontrunners Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) in the coming weeks. Below is a bit more on the companies in our theme of Coronavirus Vaccine stocks and their relative performance.

Novavax (NVAX), a vaccine development company, began late-stage trials of its Covid vaccine in the U.K in September, and large-scale phase 3 trials are due to begin in the U.S. and Mexico this month. While the company doesn’t have any other products on the market yet, its flu vaccine NanoFlu could be ready for potential FDA approval. The company has received about $1.6 billion in funding from the Federal government. The stock has soared 2,000% year-to-date.

NVAX

Moderna (MRNA) , a clinical-stage biotech company, is carrying out phase 3 trials of its Covid-19 vaccine, completing enrollment of 30,000 participants. The company is likely to have data on whether its vaccine works or not by this month, and has noted that it would seek emergency approval from the FDA if the vaccine is at least 70% effective. The stock is up 253% this year.

Johnson & Johnson (JNJ): Unlike most other vaccine candidates, which are likely to require two shots, J&J is targeting a single-dose vaccine. While the company had to pause trials in mid-October after an illness was reported in a volunteer, the company is now preparing to resume trials.  The stock is down by -5.1% this year.

Pfizer (PFE) is working with German partner BioNTech on a Covid-19 vaccine. The company is likely to have efficacy data from late-stage trials available shortly. The company could supply about 40 million doses in the United States in 2020 if the data is positive and regulators approve the vaccine. The stock is down by about -7.6% this year.

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1. Weekly Covid-19 Vaccine Allocations, KFF [↩]
2. J&J Press Release [↩]
3. Bloomberg Vaccine Tracker [↩]
4. The New England Journal Of Medicine [↩]
5. Johnson & Johnson Expects Vaccine Results Soon but Lags in Production, New York Times [↩]