Coronavirus Makes Biotech ETFs Red Hot

The biotech space of the broader healthcare sector is currently the hottest of all segments buoyed by the COVID-19 pandemic. This is especially true as the rapidly spreading virus, which has now infected more than 2.4 million people globally and claimed 166,000 lives, has raised the need to diagnose the disease, leading to strong demand for testing kits.  

The epidemic has also opened new doors for biotech companies, whether big or small, to discover and create vaccines and treatments related to the COVID-19 pandemic.

Testing Kits

Many companies have quickly developed tests receiving emergency use authorization (EUA) from the U.S. Food and Drug Administration (FDA). Abbott Labs (ABT - Free Report) has launched the fastest COVID-19 test so far. The test, which runs on the company's widely used ID NOW molecular diagnostics platform, can deliver positive results within five minutes and negative results within 13 minutes. The company now plans to ramp up to 20 million antibody tests in June and beyond.

Roche Holding AG will start selling an antibody test for COVID-19 early next month while Thermo Fisher Scientific (TMO - Free Report) aims to produce 100,000 diagnostic testing kits per day after receiving the CE mark in late March.

Treatment Progress

In particular, Gilead Sciences (GILD - Free Report) has been on the forefront in the race to find a treatment. The company’s COVID-19 antiviral drug, remdesivir, has been gaining increased acceptance worldwide. Per the latest report, University of Chicago Medicine researchers saw “rapid recoveries” in 125 COVID-19 patients taking Gilead’s experimental drug remdesivir as part of a clinical trial. The New England Journal of Medicine showcased that 68% of 53 hospitalized patients who had received remdesivir on a compassionate-use basis showed clinical improvements.

Other drug makers like Amgen (AMGN - Free Report) and Regeneron Pharmaceuticals (REGN - Free Report) are also showing strong potential to treat COVID-19. Amgen early this month partnered with Adaptive Biotechnologies to develop fully human neutralizing antibodies targeting the SARS-CoV-2 virus to prevent or treat COVID-19. Regeneron Pharmaceuticals’ rheumatoid arthritis drug, Kevzara, is currently in Phase 2/3 trial, which began on Mar 16 with up to 400 patients in 16 different cities. The early results of 21 patients treated in China have shown small improvements in fever and neuropathy of origin.

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