MediciNova Stock Hits Multi-Year High After This Big News: Will It Sustain?
Pharmaceutical companies that have become involved in working on a coronavirus vaccine have seen their stocks soar over the course of the past few months and the latest company to join that group is MediciNova, Inc. (NASDAQ:MNOV). That small-cap pharmaceutical company announced on Monday that it entered into a collaboration to create a vaccine for the novel COVID 19 and soon enough its stock started soaring.
Collaboration With Biocomo And Mie University
After the announcement, the MediciNova stock soared by as much as 95% and emerged as one of the major gainers from among small-cap pharmaceutical stocks. Under these circumstances, it could be worthwhile for investors to take a closer look at the company and the developments around it.
The company announced that it has decided to collaborate with Mie University and BioComo in order to develop the said vaccine. The two partners are both based out of Japan and have developed a novel vector that administers proteins as well as viral genes into human cells. It should be noted that the platform in question has also been used to develop vaccines for the respiratory syncytial virus and the Ebola virus.
As per the terms of the agreement, MediciNova is going to get the global development rights to use the vector technology so as to develop the COVID 19 vaccine. While it is a significant development for the company, it is also important to note that it might be a bit later for MediciNova to get it on the act. Many companies are in far advanced stages of development when it comes to coronavirus vaccines.
That being said, investors need to keep in mind that delivery technology has proven to be the biggest hurdle for companies that are developing coronavirus vaccines. However, this particular collaboration from MediciNova places vaccine delivery at the top of its concerns.
The company is going to develop a viral vector called BC-PIV, which will be able to take a payload of viral proteins on its surface as well as on its membrane. Additionally, it can maintain the original structure of the proteins and also ensure that there are no secondary immune responses. However, the effectiveness of the aforementioned vector would ensure that the vaccines in question do not require efficiency-enhancing adjuvants.
Hence, it is a bit of a positive that the company has started its efforts to create a coronavirus vaccine by focussing on delivery first. Moreover, that could also be the reason why there was such excitement in the markets after the announcement on Monday. However, it should be noted that even after the rally yesterday, the company still only has a market cap of $400 million. While the world will need as many vaccines as possible, MediciNova is still quite a bit away from coming up with a commercial vaccine at this point.
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