Gilead Sciences shares set to trade higher after remdesivir to become first European Covid-19 therapy
Shares in the US-based biotech company are likely to trend higher after its Covid-19 therapy remdesivir gets the go-ahead in Europe.
Gilead Sciences shares are likely to trend higher in the near-term after its antiviral drug remdesivir is set to become Europe’s first Covid-19 therapy.
Gilead Sciences is trading at $74.70 per share at the time of publication.
Healthcare regulators from the European Medicines Agency (EMA) approved the antiviral drug on Thursday by its Human Medicines Committee (CHMP), who recommended that the drug be used to treat adults and adolescents from 12 years old who are suffering severe coronavirus symptoms.
The EMA endorsement of Gilead Sciences antiviral drug allows remdesivir to be prescribed by European doctors, subject to the EU Commission giving the go ahead, which is expected to happen in a matter of days.
Can Gilead Sciences meet demand for remdesivir?
As of yet, the price point for remdesivir in Europe is unknown. However, in the US, where it is already being used as a treatment for the coronavirus pandemic it costs $5080 per round.
Appetite for the antiviral drug remains high around the world, but investors have expressed concern about whether Gilead Sciences will be able to manufacture enough of it to adequately meet demand.
As it stands, the US-based biotech company said that it will be able to provide more than two million courses of its antiviral drug, which will be branded under the name Veklury, by the end of 2020 – representing a two-fold increase on its previous supply target.
Analysts optimistic about Gilead Sciences share price
Since remdesivir’s drug trials on humans showed promise of treating Covid-19 patients the company’s stock has outperformed the broader market, with its share price up 14% year-to-date compared with the S&P 500 which, despite a valiant recovery of late, is 6% down over the same period.
The 23 analysts offering 12-month price forecasts for Gilead Sciences have a median target of $81 per share, with a high estimate of $97 and a low estimate of $58.
The median estimate represents a 8.4% increase from its current level. Meanwhile, the high estimate implies a potential upside of up 29.8% and the low estimate suggests the stock could fall by as much as 22.3%.
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