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Joining forces against Corona

The race in the healthcare industry for a drug against COVID-19 is in full swing. With carefully selected investments, investors can bring the promising topic into the portfolio.

They are only 120 to 160 nanometers in size, often rounded in shape with club-shaped projections whose appearance is reminiscent of a solar corona. They actually appear relatively harmless on the electron microscopic image, and yet the corona virus currently keeps the entire planet in suspense. In the truest sense of the word: The new SARS-CoV-2 can cause serious respiratory syndromes.

So that people do not literally run out of breath, health groups around the world are researching intensively on medicines and vaccines against the virus. In view of the rapid spread, this is also urgently necessary. According to data from Thomson Reuters, ten million people worldwide had contracted the new virus by the end of June and more than half a million patients died of or with COVID-19. The number of infected people is roughly twice the number of severe flu cases registered annually by the World Health Organization (WHO). The WHO hopes that hundreds of millions of doses of a vaccine can be produced this year. According to WHO chief scientist Soumya Swaminathan, there will be two billion doses by the end of 2021.

But the biotech and pharmaceutical companies are still looking. According to the auditing firm EY, the industry was working on 161 vaccine candidates and 242 therapeutic drug candidates at the beginning of June. In addition, more than 700 COVID-19 tests have already been developed or launched on the market.

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A lot of research money

“It will be a game changer for the company that has the vaccine,” said Alexander Nuyken, head of life sciences transaction advice in the EMEIA region (Europe, Middle East, India and Africa) for EY. However, he believes that the majority of the development funds are silting up, because he believes that 97 percent of the vaccines to be tested will not see the light of day (source: ey.com, press release of June 15, 2020).

Despite the small chances of success, or maybe because of it, more and more countries are positioning themselves in the race for a corona active ingredient. For example, the United States is investing ten billion dollars in vaccination projects, and a first donor conference initiated by the EU raised over seven billion euros. In addition, further calls for donations are in full swing. With these funds, research can be carried out faster. Speaking of research: even without corona, pharmaceutical companies are spending more and more money in the fight against diseases. According to Statista data, global research and development expenditures should increase by more than 50 percent by 2024 compared to 2011.Pharmaceutical companies in competition

Large pharmaceutical companies such as Sanofi and Roche, but also small biotech companies such as the German CureVac by billionaire Dietmar Hopp are at the start on the old continent. Even the German state has now taken part in the Tübingen. Sanofi is currently at the forefront of vaccine development. For boss Paul Hudson, the likelihood of success in his own company is “higher than for everyone else” (source: handelsblatt.de, report of June 23, 2020). Hudson draws optimism from the faster than expected research progress. The drug, which was developed together with GlaxoSmithKline, could receive approval in the first half of 2021. So far, Sanofi has only anticipated the second half of next year.

In order to ensure that the Europeans were quickly provided in the event of an emergency, French President Emmanuel Macron Sanofi has proposed joining the EU Corona Vaccine Alliance. The plan is to create a network with manufacturers that will provide vaccines for the entire EU. The national quartet from Germany, France, Italy and the Netherlands has already signed a contract with AstraZeneca and, if successful, has secured 400 million doses of vaccine.

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But the United States also relies on AstraZeneca and sponsors the company, which is looking for vaccines together with the University of Oxford, with $ 1.2 billion. This also gives the US government access to 300 million vaccine doses. The White House has other hot irons in the fire. Moderna, Pfizer, Johnson & Johnson (J&J) and, more recently, Merck & Co. are on the shortlist.

The latter only started looking for a Sars CoV-2 vaccine at the end of May. For this purpose, the world’s second largest vaccine manufacturer incorporated its partner, the Austrian Themis. Competitor J&J is not alone either. He works with the state Biomedical Advanced Research and Development Authority. Together with AstraZeneca, they are researching a vector virus vaccine. The genetic material is incorporated into harmless carrier viruses that are injected as a vaccine. The immune system reacts to this with the formation of antibodies. The US biotech group Moderna is pursuing a similar plan with a gene-based vaccine. Clinical trials in humans could start in September.Effective viral agents and tests

The US biotech group Gilead Sciences holds the pole position when it comes to treating the respiratory symptoms caused by COVID-19 that require oxygen therapy. On July 3, 2020, the EU Commission approved its active ingredient remdesivir. However, the US had already issued a permit in May and it is feared that overseas hamster purchases could prevent larger deliveries to Europe.

The two Swiss pharmaceutical giants Roche and Novartis also play an important role in the fight against COVID-19. The latter not only supports 25 clinical studies and has also started three studies relevant to approval in the United States. Generics subsidiary Sandoz also supplies medications worldwide that play an important role in the treatment of SARS-CoV-2 patients. Roche also has products on the market. This includes a diagnostic test for the detection of the novel corona virus and a serological test method for the detection of antibodies against corona in humans. Basler has already received approval for both test procedures.Invest against Corona

Even small advances on the stock exchange are considered with large price premiums. The two biotech companies Moderna and Incyte have already more than doubled their market capitalization this year. The big players in the healthcare industry such as Gilead, AstraZeneca and Roche also developed significantly better than the overall market.

Corona will continue to accompany the people and therefore the stock exchanges for a very long time. The WHO even fears that the virus could stay forever. When and who will launch the first vaccine is unpredictable. It would also be possible for several vaccines to be found and used side by side. The potential billion dollar business for the manufacturers also means a great opportunity for investors. With a new open end index certificate from HypoVereinsbank onemarkets on the Global Anti Virus Health Net Return Index, interested parties have the opportunity to invest in the healthcare industry in a broadly diversified manner. Due to its composition – the index contains 20 international companies from the pharmaceutical, biotech and medical sectors – and an unlimited term, the product perfectly matches the character of this topic.“Healthy investment against the corona pandemic

The Global Anti Virus Health Net Return Index tracks the price development of 20 international companies that want to stand up to the new corona virus. The index is the net return variant. This means that distributed dividends (after tax) are reinvested in the index. Index composition

Abbott Laboratories, AbbVie Inc., AstraZeneca PLC, Bayer AG, BASF SE, Becton Dickinson and Co Corp., Beiersdorf AG, Danaher Corp., Gilead Sciences Inc., GlaxoSmithKline PLC, Incyte Corp., Johnson & Johnson Corp., Laboratory Corp. of America Corp., Novartis AG, Pfizer Corp., Quest Diagnostics Inc., Regeneron Pharmaceuticals Inc., Roche Holding AG, Sanofi SA, Thermo Fisher Scientific Inc., as of July 9, 2020, source: HypoVereinsbank onemarkets HVB Open End index certificate

UnderlyingGlobal Anti Virus Health Net Return Index
ISIN / WKNDE000HR09BX5 / HR09BX
Participation factor100%
Issue day07/21/2020
Repayment dateOpen end *
Index calculation fee1.2% p. a.
currencyEuro

* The issuer, UniCredit Bank AG, is entitled to properly cancel the certificate and repay it at the respective repayment amount
The current product details are on the website www.onemarkets.de released. The product is a bond issued by UniCredit Bank AG. In the event of their bankruptcy, i.e. insolvency or over-indebtedness, there is a risk of high losses up to total loss. Information on how the product works ; As of July 9, 2020
>> Further information on the product at: onemarkets.de/HR09BXPartial protection as an alternative

If you want to minimize the risk somewhat, you can rely on selected companies with limited partial protection. Regardless of whether it’s equity bonds, bonus cap certificates or discount and express papers – the selection of products at HypoVereinsbank onemarkets is large. Please note: The certificates and the bond are bonds from UniCredit Bank AG. In the event of the issuer’s insolvency, i.e. insolvency or over-indebtedness, there may be losses or even a total loss.HVB investment products on health stocks

UnderlyingProduct typeISIN(Last) repayment dateEquipment features
Bayer AGHVB Protect Reverse ConvertibleDE000HVB4JX8* “> DE000HVB4JX8 *11.08.2021Interest rate p. a .: 5.20% **,
Barrier: 70% ***
Gilead Sciences Inc.HVB Bonus Cap certificateDE000HZ3XKM1“> DE000HZ3XKM103/26/2021Barrier: USD 60, –
Bonus level (Cap ****): USD 90, –
Pfizer Inc.HVB Discount CertificateDE000HZ3K3S7“> DE000HZ3K3S703/26/2021Cap ****: USD 30, –
Discount: 16.00%
Roche Holding AGHVB Bonus Cap certificateDE000HZ3XUS7“> DE000HZ3XUS724.12.2021Barrier: CHF 230, –
Bonus level (Cap ****): CHF 460, –
Sanofi S.A.HVB Express certificateDE000HVB4JY6* “> DE000HVB4JY6 *08/12/2024Max. Repayment *****: EUR 1,248.00, barrier: 70% ***

* Product in drawing
** based on the nominal amount
*** from the reference price (closing price) on the initial observation day
**** upper course limit
***** Max. Redemption amount per certificate
The product details are on the website www.onemarkets.de released; Information on how the product works
As of July 9, 2020

This is a promotional message. Please note the important information and the disclaimer. (http://blog.onemarkets.de/wichtige-hinweise-haftungsausschluss/)

This article first appeared in onemarkets magazine (HypoVereinsbank – UniCredit Bank AG)

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