Two Biotech Stocks To Consider For Ebola Virus

Lately, everyday when people wake up, they hear news about a new Ebola case in various parts of the world and that the spread of the virus is continuing everywhere around the globe. Ebola is a virus that starts off with flu-like symptoms, so patients brush it off believing that it just might be the flu virus. But there are other symptoms patients then start to experience like severe vomiting, diarrhea, and abdominal pain. As of August 1, 2014 there have been 1,605 suspected cases of the Ebola virus in the countries of Guinea, Sierra Leone, Nigeria, and Liberia. Of those 1,605 cases there has been about 887 confirmed deaths.

The Ebola Virus itself has a 90% death rate when a patient is infected. There are some experimental vaccines that may prove to combat against the virus which are being tested on patients that have come back to the U.S. with this infection. One misconception about the Ebola Virus is that it is spread airborne through contact with other people. If that were the case, the spread of this virus would be huge because it would be harder to contain. This Ebola virus is spread by means of blood, saliva, sweat, and other bodily fluids, eliminating the possibility of an airborne infection. Even still this virus should not be passed off as an  irrelevant bug because once a person is infected, it causes a huge death rate at 90%.

With this Ebola Virus outbreak news there is one biotech company that has already risen a lot on these cases, known as Tekmira Pharmaceuticals (TKMR). Another biotech that may potentially rise in share price based off of these new Ebola cases is Sarepta Therapeutics (SRPT). Both of these biotechnology companies are utilizing some type of oligonucleotide technology. Oligonucleotides are short single stranded nucleic acid molecules that can be placed together with other types of technology to create new molecules to combat against these types of diseases, even the Ebola Virus.

Tekmira Pharmaceuticals makes use of oligonucleotides using a new type of science known as RNAi or RNA interference. RNA interference was created to down regulate the amount of genes a disease produces. The idea is that by knocking down the genes of the disease in question, it would either slow down the progression of the disease or cure the disease completely. Tekmira's Ebola Virus program is known as TKM-Ebola and has only begun to dose patients in a phase 1 clinical trial with the Ebola Virus. The downside is that the FDA placed a clinical hold on the TKM-Ebola trial due to safety concerns. We believe these concerns should be easily addressed in the coming months, as Tekmira's Ebola drug showed 100% protection of the Ebola Virus in non-human primates (monkeys). Despite the clinical hold  on on the Ebola clinical trial, Tekmira's share price has risen substantially over the last month gaining about 20% in share price. One thing that investors should note is that this Ebola Virus news may drive the share price in the short term, but should be cautious on a sell off when the Ebola hype dies down. Regardless, investors should be in the name based off of Tekmira's RNAi technology for other indications, because the rise in share price of the Ebola Virus program is just a bonus.

Sarepta Therapeutics makes use of a different science which has been around a long time known as RNA oligonucleotides. RNA works differently then RNAi mentioned above, because RNA is the building blocks for DNA. The goal of RNA is to change the DNA  structure of the proteins in question. This means that RNA builds off of the ability to  be able to direct the cells machinery to increase or decrease production of a protein for a particular disease. Sarepta has also been working on an Ebola drug, AVI-7537 and has seen the ability to show survival rates of the Ebola virus by 60% to 80% in animal testing. This compares with 0% survival rate in animals with the Ebola virus that recieved no treatments. Sarepta's CEO says the company stands ready to help give their drug out to patients if needed but the FDA would have to approve a certain measure to allow this to happen. Also the funding came from a government entity so Sarepta would have to get permission from them as well if they want to get their Ebola drug out to these patients that need a treatment. The difference though between Tekmira's Ebola drug and Sarepta Therapeutics is that Sarepta has yet to receive a clinical hold on its Ebola trial.

In conclusion both biotech stocks are great to consider for both traders and long term investors. Long term investors should be focused on the technology of both companies where one utilizes RNAi and the other utilizes RNA. Traders can capitalize on this great short term opportunity to make money off of the recent and upcoming Ebola news. Future news from Ebola outbreaks may move the share prices of both companies slightly in the coming months. Despite short term movements in share price, long-term investors should stay focused on the longer term picture about the science of each company. We think that there is a great opportunity to be invested in both of these stocks for both short term and long term prospects. Both of these biotech stocks have the ability to completely change the way we treat many of today's deadly diseases.