Investors who were attaching their hopes for a swift end to the coronavirus pandemic to the antiviral medicine remdesivir from Gilead Sciences were disappointed, as Gilead released news Thursday that while the data suggests a “potential benefit,” the drug failed to increase the improvement of patients with COVID-19 or prevent them from dying, according to results from a long-awaited clinical trial conducted in China.
A summary of the study results was accidentally posted to the website of the World Health Organization and seen by STAT on Thursday, but then removed.
“A draft document was provided by the authors to WHO and inadvertently posted on the website and taken down as soon as the mistake was noticed. The manuscript is undergoing peer review and we are waiting for a final version before WHO comments,” said WHO spokesperson Tarik Jasarevic.
The posting was enough time to swiftly knock stock markets off the highs for the day.
While stock indexes had been attempting to test the highs of Tuesday, the release of the study data saw a quick drop in all three benchmark stock indexes, as the S&P 500 lost more than 40 points in a matter of 5 minutes, while the Dow Jones Industrial Average and Nasdaq Composite posted similar drops.
Gilead shares also surged over 7% last week after STAT news reported that a Chicago hospital treating coronavirus patients with redelivering in a trial were recovering rapidly from severe symptoms. The publication cited a video it obtained where the trial results were discussed.
Most analysts and investors have felt that curtailing the virus is key to improving the economic backdrop in the long term.
“An effective treatment is a huge deal and would create a path to open the economy and resume normal ‘social activities’ way sooner than a vaccine,” said Tom Lee, head of research at Fundstrat Global Advisors. “A treatment is safer and more scalable because it is only given to people who need to be treated.”
“If it is effective in keeping someone from contracting the virus or, more likely, simply reduces its severity, that would be a game-changer and [would]allow the economy to restart both more quickly and more fully,” said Jim Paulsen, chief investment strategist at The Leuthold Group, about the Remdesivir trial report.
An outside researcher said that the results from the study mean that any benefit from remdesivir is likely to be small.
“If there is no benefit to remdesivir in a study this size, this suggests that the overall benefit of remdesivir in this population with advanced infection is likely to be small in the larger Gilead trial,” said Andrew Hill, senior visiting research fellow at Liverpool University.
The iShares Nasdaq Biotechnology ETF (IBB) and the VanEck Vectors Biotech ETF (BBH), which each contain Gilead, are still positive on the day, amid the news.
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