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The U.S. Government has signed a $1.95 billion deal with Pfizer and BioNTech for their COVID-19 vaccine. The prices PFE and BNTX stocks are moving higher.
The United States has agreed to pay Pfizer Inc (NYSE: PFE) and BioNTech SE (NASDAQ: BNTX) $1.95 billion for a safe and effective coronavirus vaccine. Before now, both companies have been working together to develop four potential vaccines for the deadly virus. According to an announcement on the 22nd of July, the U.S. will pay the agreed sum, only after FDA approval. The $1.95 billion covers an initial order of 100 million doses and an additional 500 million. However, Pfizer has declared that the duo will not accept the payment until they have successfully manufactured an effective vaccine. Also, the Department of Health and Human Services (HHS) has revealed that Americans will not pay for the approved vaccine.
Speaking on the agreement with the U.S. government, Ugur Sahin, the MD, CEO and Co-founder of BioNTech said:
“We are pleased to have signed this important agreement with the US government to supply the initial 100 million doses upon approval as part of our commitment to address the global health threat. The agreement is one of many steps towards providing global access to a safe and efficacious [vaccine] for COVID-19… Our goal remains to bring a safe and effective COVID-19 vaccine to many people around the world, as quickly as we can.”
Pfizer and BioNTech Join Others in Operation Warp Speed Project
In April, the Trump administration introduced Operation Warp Speed to promote mass production of various COVID-19 vaccines. As part of the project, the US government signed deals with Biotechs to accelerate the development of COVID-19 vaccines. The Biotech firms include Novavax who received $1.6 billion from the government. Novavax plans to deliver 100 million doses of its vaccine by January 2021.
However, the $1.95 billion deal with Pfizer and BioNTech appears to be the biggest yet signed, as part of the Operation Warp Speed.
Joint Coronavirus Vaccines
On the 16th of March, Pfizer and BioNTech announced plans for both companies to jointly produce an mRNA-based coronavirus vaccine. The joint venture has been productive as two of the four vaccine candidates, BNT162b1 and BNT162b2, recently received a Fast Track designation from the U.S. Food and Drug Administration (FDA).
In addition, Pfizer and BioNTech declared BNT162b1 the most advanced of the vaccine candidates earlier this month. The head of Pfizer’s vaccine research and development said in a press release:
“We are encouraged by the clinical data of BNT162b1, one of four mRNA constructs we are evaluating clinically, and for which we have positive preliminary, topline findings. We are dedicated to developing potentially groundbreaking vaccines and medicines, and in the face of this global health crisis, we approach this goal with the utmost urgency.”
Also, both companies said that they hope to seek regulatory authorization by October if the clinical trial proves successful. If Phase 3 is successful, Pfizer and BioNTech expect to produce up to 100 million doses by the end of the year. Also, the joint venture hopes to have manufactured over 1.3 billion doses by the end of 2021.
Pfizer and BioNtech Stock Performances
Presently, BioNTech (BNTX) stock is trading at $100.99, a 10.25% increase over its previous close of $91.60. The stock has gained 194.55% in its year-to-date performance, and 86.53% in the last three months. Also, in the last five days, the stock jumped 27.82%.
Pfizer stock, on the other hand, has lost over 2% in 2020. However, its performance is getting better as PFE has been increasing for the last three months. Pfizer is currently trading at $38.24, a 4.25% increase over its last close of $36.69.