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Merck & Co., Inc. MRK has signed multiple agreements to make available its existing manufacturing facilities for the development of COVID-19 vaccines and medicines after its own efforts to create vaccines failed.
Merck signed a deal with J&J JNJ to support manufacturing of the latter’s single-shot COVID-19 vaccine, which was recently granted Emergency Use Authorization (EUA) by the FDA. Merck will manufacture drug substance, formulate and fill vials of J&J’s vaccine, using its plants in the United States, which should help the latter beef up its vaccine supply. J&J’s vaccine is the third COVID-19 vaccine to be available in the United States. The other two, Pfizer PFE/BioNTechand Moderna’s MRNA mRNA-based vaccines were launched for emergency use in the United States last year.
Separately, The Biomedical Advanced Research and Development Authority (BARDA) of the U.S. Department of Health and Human Services (HHS) will provide Merck with a funding of up to $268.8 million to make available its existing manufacturing facilities to develop COVID-19 vaccines and medicines.
Merck’s stock has declined 10.9% this year so far compared with a decrease of 0.8% for the industry.
We remind investors that in January, Merck discontinued the development of its two COVID-19 vaccine candidates, V590 and V591, which were in early-stage studies. It took the decision due to inferior immune responses observed for patients given the two vaccines in phase I studies compared to those seen in patients who were infected naturally and those reported for other COVID-19 vaccines. With its own vaccine development plans ended, Merck is expected to have free up capacity to help COVID-19 vaccine manufacturers like J&J to help boost U.S. COVID-19 vaccine supply.
Reportedly, the deal between the two rival companies was fostered by Biden administration to ramp-up COVID-19 vaccine production. Biden, on Tuesday said, he expects to have enough vaccines supply to inoculate every adult American by the end of May.
Merck, however, continues to develop its two therapeutics for COVID-19 — its oral antiviral candidate molnupiravir/MK-4482 (phase II/III) and biological therapeutic, MK-7110 (phase III). MK-4482 is being developed in collaboration with Ridgeback Bio. Two pivotal studies are evaluating the candidate in non-hospitalized adult COVID-19 patients or hospitalized adult COVID-19 patients. For MK-7110, Merck has an agreement with the U.S. government to supply 60,000-100,000 doses of MK-7110, upon potential approval or an EUA from the FDA.
Merck currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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