(Bloomberg) – Manufacturers of vaccines and other coronavirus treatments declined in Asia after Merck & Co. said its experimental pill cut the risk of hospitalization and death from Covid-19 in half.
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The declines followed a slump in the shares of BioNTech SE and Moderna Inc. in New York on Friday after Merck delivered the news about its drug, seen by some as a turning point in the global fight against Covid-19.
Shanghai Fosun Pharmaceutical Group Co., which has an agreement to distribute BioNTech and Pfizer Inc.’s vaccine in Greater China, slumped up to 21% in Hong Kong, causing losses in the region’s healthcare stocks.
Drug manufacturers were broadly weaker, with CSPC Pharmaceutical Group Ltd. and Wuxi Biologics (Cayman) Inc. each fell more than 7%, one of the largest declines in the Hang Seng Index. In Japan, JCR Pharmaceuticals Co., which is tasked with making AstraZeneca Plc’s jabs, and Fujifilm Holdings Corp., which makes Avigan for treatment and reagents for Covid testing, lost about 5% each.
“This is on the back of Merck’s breakthrough pill that requires emergency FDA approval before it can be launched,” said Justin Tang, director of Asian research at United First Partners. “With vaccine stocks currently valued at elevated levels, investors need to adopt a sell-first-ask-later attitude.”
The results of the Merck pill study were so encouraging that the drug manufacturer and its partner, in consultation with independent study monitors and the U.S. Food and Drug Administration, decided to stop patient recruitment and begin the regulatory approval process.
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