The potential for a vaccine for coronavirus has flooded news headlines recently, causing some ASX shares to rally. The rush to find a 'silver bullet' cure for the pandemic has resulted in a slew of listed companies announcing their intentions to undertake research around a possible cure.
Despite the optimism and enthusiasm for a vaccine, many scientists have indicated that a well-trialled and tested vaccine for COVID-19 could take much longer than 18 months to develop. The vast majority of vaccines fail somewhere between Phase 1 and Phase 2 trials.
Given the nature of COVID-19 and the trial processes involved in vaccine development, companies that have joined the race to find a cure could face a long and costly journey. As a result, the focus has also turned to alternative methods of treating and testing for COVID-19.
Here are 2 ASX biotechnology companies that have joined the fight against COVID-19.
2 ASX shares involved the fight against coronavirus
Mesoblast limited (ASX: MSB)
Mesoblast is a world leader in developing regenerative medicines for inflammatory diseases and prides itself on innovation surrounding stem cell research. The company made headlines late last month after announcing promising results for its remestemcel-L treatment for COVID-19. In a US trial, Mesoblast recorded an 83% survival rate in ventilator-dependent COVID-19 patients, while 75% of patients had successfully come off ventilator support within 10 days.
Mesoblast's remestemcel-L product acts by counteracting the inflammatory processes caused by COVID-19. The company is currently undertaking a $46 million Phase 2/3 trial in the US in order to attain approval from the US Food and Drug Administration.
The promising results from its US trials has seen the Mesoblast share price surge more than 250% from its lows in mid-March. The company recently completed a $138 million capital raising in order to scale-up manufacturing of its products and is also in the process of conducting clinical trials in Australia.
CSL Limited (ASX: CSL)
CSL is not actively participating in the race to develop a vaccine for COVID-19. The biotechnology giant is, however, working hard to develop a plasma product that may assist in the recovery of patients battling the disease. In collaboration with the Australian Red Cross Lifeblood Service, CSL is collecting plasma from patients who have recovered from COVID-19. The collected plasma, which contains antibodies, will then be used to support a clinical trial aimed at improving the condition of COVID-19 patients and reducing their need for ventilation.
Should you buy these ASX shares?
Despite the optimism surrounding a coronavirus vaccine, the reality is that a successful solution will not happen overnight. Biotech companies have to undergo arduous and costly approval processes and clinical trails before actually getting a product to market.
As a result, I think investors should exercise caution when companies announce their intentions to fight COVID-19. In my opinion, if you're keen on investing in the sector, tried and tested performers like CSL would be the best, long-term option as they offer greater risk protection.
