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Investors value stocks in companies that could benefit from monkeypox

As health officials around the world look for ways to stem monkeypox outbreaks, investors are buying up stakes in companies that could profit from the race to bring the disease under control.

Stocks in vaccine makers, antiviral drug makers, and protective equipment makers are in demand as investors capitalize on strategies that have paid off during the coronavirus pandemic. Biotech company Bavarian Nordic A/S and pharmaceutical company Siga Technologies Inc. are in the spotlight, as is medical tools supplier Precision System Science Co.

Although not as serious as the Covid-19 outbreak, the World Health Organization declared it a global emergency as monkeypox infections spread to more than 70 countries in just a few months. It can give you an additional tailwind.

Manish Bhargava, Fund Manager at Straits Investment Holdings Pte (Singapore) said: “We can expect other biotech companies to ramp up research and production to keep up with demand, which is starting to be reflected in the sector’s strong share price performance.”

Below are some of the active sectors and companies.

vaccines and antivirals

Bavarian Nordic shares have more than tripled from their May lows after governments began placing orders for monkeypox vaccines from a Danish company. The company has raised its earnings guidance several times this year.

Analysts are watching, with Citigroup raising its price target on its stock by 20% and warning it could go higher if more orders come in. Stocks in other companies that make monkeypox vaccines and antiviral drugs have also caught the attention of U.S. retailers. Siga Technologies’ inventory, which makes a treatment called Tpoxx, has doubled this year. .

Chimerix Inc.’s Tembexa is an antidote used to treat smallpox, and the company announced in May that it would sell the drug to Emergent BioSolutions Inc. Against monkeypox. Siga, Chimerix and Emergent are “major beneficiaries” of the WHO’s declaration that the monkeypox outbreak is a global emergency, according to Cowen analyst Boris Peker. “As more resources are allocated to contact tracing and testing in the EU and the US, we can expect a significant increase in the number of cases in the coming months and the potential for more measures to be put in place. ‘” Peaker wrote in a note.

Monkeypox declared health emergency in New York

New York City officials have declared a public health emergency due to the spread of the monkeypox virus, calling the city the “epicenter” of the outbreak. An announcement on Saturday by Mayor Eric Adams and Health Commissioner Ashwin Bassan said as many as 150,000 citizens could be at risk of infection.

The declaration will allow authorities to issue emergency orders under the city’s health code and amend the code’s provisions to take action to slow the spread of the disease.

In the past two days, New York Governor Kathy Hochul has declared a state disaster emergency, and the state health department has called monkeypox an “imminent threat to public health.” In New York, he had 1,345 cases recorded as of Friday (Reuters).

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