Shares of AstraZeneca (AZN) are in the spotlight on Wednesday after the company confirmed that it has halted late-stage trials of its COVID-19 vaccine due to a serious suspected adverse reaction in a participant. Commenting on the news, SVB Leerink analyst Mani Foroohar said the pause could be a "mixed blessing" for Moderna (MRNA) and other drugmakers also developing a COVID-19 vaccine. Noting that the hold removes the scenario of any Emergency Use Authorization granted to AZD1222, B. Riley FBR analyst Mayank Mamtani added that he estimates the delay will be at least one month, which could allow other vaccines to "leapfrog" AstraZeneca's. 

COVID VACCINE TRIAL ON HOLD: AstraZeneca has confirmed that as part of the ongoing randomized, controlled clinical trials of the AstraZeneca Oxford coronavirus vaccine, AZD1222, a standard review process has been triggered, leading to the voluntary pause of vaccination across all trials to allow an independent committee to review the safety data of a single event of an unexplained illness that occurred in the UK Phase III trial.

"This is a routine action which has to happen whenever there is a potentially unexplained illness in one of the trials, while it is investigated, ensuring we maintain the integrity of the trials. In large clinical trials, illnesses will happen by chance and must be independently reviewed. AstraZeneca is working to expedite the review of the single event to minimize any potential impact on the trial timeline. We are committed to the safety of our participants and the highest standards of conduct in our trials," the company said.

CEO Pascal Soriot added, "At AstraZeneca we put science, safety and the interests of society at the heart of our work. This temporary pause is living proof that we follow those principles while a single event at one of our trial sites is assessed by a committee of independent experts. We will be guided by this committee as to when the trials could restart so that we can continue our work at the earliest opportunity to provide this vaccine broadly, equitably and at no profit during this pandemic."

HOLD COULD CAUSE RIPPLE: Citing a STAT News report ahead of AstraZeneca's confirmation, SVB Leerink analyst Andrew Berens said that "perhaps the most perplexing component," and one that he thinks could cause some concern to resonate broadly in the market, was the reported commentary by an individual "familiar with the matter" suggesting that this undisclosed adverse event could have an impact on other trials by other vaccine manufacturers.

The suggestion of a broader impact could cause near-term volatility in AstraZeneca's shares as well as other companies with COVID vaccine programs until the exact nature of the adverse event is disclosed, and whether other programs targeting the same antigen are similarly impacted. Overall, Berens believes that the pace of many of the programs could be impacted as the investigation progresses and the sponsors become more vigilant, as well as public sentiment regarding the safety of the vaccines once approved. He has an Outperform rating AstraZeneca's shares.

'MIXED BLESSING' FOR MODERNA, OTHERS: Based on feedback from AstraZeneca, SVB Leerink analyst Mani Foroohar believes the hold reflects reasonable caution on the part of the company, given the high safety bar for a vaccine that is being developed for potential administration to many millions of healthy individuals. Given key differences in delivery vector and underlying technology, he sees limited readacross to mRNA or protein subunit vaccine candidates from this signal - which ultimately may be easily explicable once the data is fully evaluated, which may take some time – though to the extent that this episode leads to broader vaccine hesitance among the general population or greater regulatory scrutiny across mechanisms of action, all vaccine developers may have reason for concern. The analyst expects Moderna's shares to trade up in reaction to reduced competition to be second to market after Pfizer (PFE)/BioNTech (BNTX). He has an Underperform rating on Moderna's shares.

HOLD OPENS WINDOW FOR OTHER CANDIDATES: The hold put on AstraZeneca's Phase III COVID-19 vaccine study due to a "suspected serious adverse reaction" in a participant receiving AZD1222 at a U.K. trial site reinforces the need for accumulating a large safety database before regulatory approvals are granted, B. Riley FBR analyst Mayank Mamtani told investors in a research note.

The hold also removes the scenario of any Emergency Use Authorization granted to AZD1222 prior to completion of the trial, which to some extent was weighing on COVID-19 vaccine candidates such as Novavax's (NVAX) NVX-CoV2373 as a disadvantage when it comes to speed to market, the analyst said. Mamtani estimates the delay will be at least one month, which could allow other vaccines to "leapfrog" AstraZeneca's. The analyst also noted that the development opens the window for Novavax, Arcturus Therapeutics (ARCT), and Vaxart (VXRT). He reiterated Buy rating on all three names.

PRICE ACTION: In morning trading, shares of AstraZeneca are fractionally down at $54.53. Meanwhile, Moderna and Novavax have gained about 3% apiece to $55.72 and $87.78, respectively. Also, higher Pfizer has advanced about 1% to $36.26 and BioNTech has gained almost 4% to $61.96.