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Global Economy

Swiss Covid drug on the verge of a breakthrough – FOPH gets first 200,000 doses

Here’s what it’s all about

A Swiss-made Covid drug has proven its effectiveness in tests.

The drug comes from Molecular Partners, and Novartis is licensing it.

Now the companies stand to make a lot of money.

Swiss corona drug Ensovibep reduces viral load and protects against hospitalizations. That’s what a Phase II trial showed, Swiss pharma giant Novartis and Schlieren-based Molecular Partners announced Monday.

Novartis is in the process of applying for an emergency license in the United States. “This can happen very quickly and is also being pushed in Switzerland,” Patrick Amstutz, CEO of Molecular Partners, told 20 Minutes. He said Switzerland sponsored the infusion drug and therefore has the opportunity to buy the first 200,000 doses. Contracts with other countries do not yet exist, he said.

“Those who don’t order now will have delivery problems later”.

Zu Beginn der Pandemie warf der Markt Novartis vor, zu zögerlich zu handeln.

But that will probably not last much longer. “Those who don’t order now may have delivery problems later,” says pharmaceutical analyst Stefan Schneider of Bank Vontobel. Pfizer and Merck have commitments for billions of dollars in sales for their Corona pills with orders from the U.S. government alone, he says.

Whether there will also be such amounts for the Swiss infusion drug is still open. But “no one knows yet which drug is the best,” Schneider said, “and big sales could be considered for the new drug – provided it receives emergency approval.”

Molecular Partners has been working with Novartis for a year because it needed a large partner for the clinical trial, CEO Amstutz says. In addition, Novartis offered the ideal logistics with Sandoz, he adds. The Basel-based pharmaceutical giant is now responsible for development, manufacturing, distribution and commercialization of the drug.

Novartis pays millions

In return, Molecular Partners received millions. When the contract was signed a year ago, Novartis paid 60 million Swiss francs at the beginning and another 150 million Swiss francs when the test was passed. In addition, the pharmaceutical company has paid all expenses since then, probably in the double-digit millions, Amstutz said. In addition, there is 22 percent revenue sharing on the drug. “It’s a good deal for both,” Amstutz says.

Pharma analyst Schneider is also convinced that both companies will benefit from the collaboration. “For Molecular Partners, it’s a super deal because it can secure financing until 2025 with the money from Novartis,” Schneider says. In addition, he said, 22 percent revenue sharing is a great deal, especially since that was negotiated during phase two. The company’s stock rose about 25 percent Monday.

For its part, he said, Novartis is benefiting from the fact that it is now more active in the fight against Corona. “At the start of the pandemic, the market accused Novartis of being hesitant to act. Now they have the opportunity to be actively involved – and can, in some circumstances, generate big sales,” Schneider says.

Novartis share price likely to rise further

Jetzt hat Novartis die Möglichkeit, aktiv mit dabei zu sein und grosse Umsätze zu erzielen.

Novartis shares rose less than one percent, but in addition to the fact that the drug still has to clear the approval hurdle, “Novartis is also much bigger than Molecular Partners, so the swing upward is not as big,” Schneider says.

If the drug receives approval, however, Novartis shares are likely to rise significantly again. Such commercial milestones usually bring bigger stock moves, pharma expert Gianpaolo Chiriano of private bank Mirabaud tells 20 Minuten. Chiriano sees Ensovibep as a “real alternative” to existing therapies that may be less effective in treating the new variants. He estimates the sales potential to be in the triple-digit
millions.

Pharma expert Lorenzo Biasio of Credit Suisse also believes sales of several hundred million Swiss francs with the drug are realistic. “It could ultimately be a positive story for both companies,” Biasio says.

This is Molecular Partners

Founded in 2004, Molecular Partners is a spin-off of the University of Zurich with more than 150 employees in Schlieren and three employees in the United States.The company started with cancer drugs and then developed the Corona drug.

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