The World Health Organization's monkeypox emergency declaration sent vaccine stocks soaring, raising questions about who really benefits from global health crises.

A Familiar Scenario Unfolds

On July 23, 2024, the World Health Organization (WHO) declared the escalating global monkeypox outbreak a Public Health Emergency of International Concern (PHEIC).¹ For many, this announcement triggered an unsettling sense of déjà vu, reminiscent of the early days of the COVID-19 pandemic. However, for a select group of pharmaceutical companies specializing in vaccines and antivirals, the WHO's decision signaled a potential windfall.

Market Reaction: Investors Bet on Vaccine Makers

Within hours of the WHO announcement, stock prices for companies with monkeypox vaccine candidates or existing smallpox vaccines (which offer cross-protection) saw significant gains. Bavarian Nordic, the Danish biotech firm behind the Jynneos vaccine, saw its shares jump by 27% in the days following the declaration.² Other beneficiaries included SIGA Technologies, maker of the antiviral tecovirimat, whose stock climbed by 17%.³

This immediate market response highlights the complex relationship between global health crises and pharmaceutical profits. The financial opportunities presented by such emergencies raise questions about incentives and pricing.

The Major Players: Who Stands to Gain?

Three primary vaccine suppliers are at the forefront of the monkeypox response:

1. Bavarian Nordic (Jynneos/Imvanex/Imvamune)
2. Emergent BioSolutions (ACAM2000)
3. Tonix Pharmaceuticals (TNX-801, in development)

Bavarian Nordic's Jynneos vaccine, already approved for smallpox and monkeypox in the U.S., received expedited approval for monkeypox in Europe following the WHO declaration.⁴ The company has ramped up production and is in discussions with multiple countries for vaccine supply agreements.

Emergent BioSolutions, while facing challenges related to its COVID-19 vaccine manufacturing issues, still maintains a significant stockpile of its ACAM2000 smallpox vaccine.⁵

Tonix Pharmaceuticals, a smaller player, is developing TNX-801, a live virus vaccine based on horsepox. While still in preclinical stages, the company's stock has seen increased interest due to the potential for a next-generation monkeypox vaccine.⁶

Supply and Demand: Manufacturing Constraints

The sudden global demand for monkeypox vaccines has put pressure on existing supply chains. Bavarian Nordic, the primary supplier of the Jynneos vaccine, faces the challenge of rapidly scaling up production. The company has announced plans to expand its manufacturing capacity but acknowledges that meeting global demand will take time.⁷

This supply bottleneck raises concerns about equitable vaccine distribution, particularly for low- and middle-income countries. The WHO has called for fairness in vaccine allocation, but historical patterns suggest that wealthier nations may secure the bulk of early supplies.⁸

Pricing Pressures and Profit Margins

As governments scramble to secure vaccine doses, questions arise about pricing and profit margins. Bavarian Nordic has not publicly disclosed its pricing structure for the Jynneos vaccine, citing confidentiality agreements with various countries.⁹ However, analysts estimate that the company stands to generate significant revenue from vaccine sales in the coming years.

The delicate balance between fair pricing and maintaining incentives for pharmaceutical innovation is once again at the forefront of public debate. Critics argue that companies should not profiteer from a global health emergency.¹⁰

Long-Term Business Impact: Beyond the Immediate Crisis

While the current focus is on addressing the immediate monkeypox outbreak, pharmaceutical companies and investors are also considering the long-term implications of this event. Key questions include:

1. Will monkeypox become endemic, requiring ongoing vaccination programs?
2. How will this outbreak influence government stockpiling policies for vaccines against potential bioterror threats?
3. Will increased funding flow into research for other neglected tropical diseases?

The answers to these questions will shape the long-term business prospects for companies involved in monkeypox vaccine and treatment development.

Balancing Public Health and Profit: Ethical Considerations

The monkeypox outbreak and subsequent WHO declaration have reignited discussions about the ethics of profiting from public health emergencies. The potential for windfall profits during crises raises significant concerns.

Some public health experts advocate for alternative models, such as advanced market commitments or government-funded research and development, to ensure that critical vaccines and treatments are available at affordable prices when needed.¹¹ Others argue that the current profit-driven model, despite its flaws, remains the most effective way to spur rapid innovation in times of crisis.

Conclusion: A Complex Ecosystem of Health and Commerce

The WHO's monkeypox emergency declaration has set in motion a complex interplay of public health imperatives and commercial opportunities. One thing is certain, vaccine manufacturers stand to benefit financially from increased demand.

References

1. World Health Organization, "WHO Director-General declares the ongoing monkeypox outbreak a Public Health Emergency of International Concern," July 23, 2024, https://www.who.int/news/item/23-07-2024-monkeypox-is-declared-a-global-health-emergency.

2. Financial Times, "Bavarian Nordic shares surge after monkeypox emergency declaration," July 25, 2024.

3. Reuters, "SIGA Technologies stock climbs on monkeypox treatment potential," July 24, 2024.

4. European Medicines Agency, "EMA recommends approval of Imvanex for the prevention of monkeypox disease," July 22, 2024, https://www.ema.europa.eu/en/news/ema-recommends-approval-imvanex-prevention-monkeypox-disease.

5. U.S. Food and Drug Administration, "ACAM2000 (Smallpox Vaccine) Questions and Answers," accessed August 15, 2024, https://www.fda.gov/vaccines-blood-biologics/vaccines/acam2000-smallpox-vaccine-questions-and-answers.

6. Tonix Pharmaceuticals, "Tonix Pharmaceuticals Announces Positive Efficacy Data from Animal Study of TNX-801 Vaccine to Prevent Monkeypox," June 15, 2024.

7. Bavarian Nordic, "Bavarian Nordic Expands Capacity to Meet Demand for Monkeypox Vaccine," August 1, 2024.

8. World Health Organization, "WHO calls for equitable access to monkeypox vaccines," July 27, 2024.

9. Bloomberg, "Monkeypox Vaccine Maker Keeps Mum on Pricing as Demand Surges," July 29, 2024.

10. Nature, "The thorny issue of vaccine pricing," August 5, 2024.

11. The Lancet, "Rethinking pharmaceutical incentives in public health emergencies," August 10, 2024.