Gilead Sciences (GILD) Makes Big Gains on News of Coronavirus Drug

Pretty much ever since coronavirus showed up, and definitely since coronavirus closed just about everything in sight, people have been eager to see a drug to treat coronavirus emerge. While hydroxychloroquine has made some great advances, it's hardly alone in this market, and leading the way right now is Gilead Sciences (NASDAQ: GILD). It's leading so hard, in fact, that it just saw an after-hours trading spike in its stock to the tune of 16%.

Good News Has a Way of Spiking Prices

Though Gilead gave back some of those gains over the course of the trading day so far, it's still well off its previous day's close of $76.54. As of this writing it's at $83.04, in fact, so that's some substantial gain.

Driving those massive gains was an unfamiliar thing in the economy of the last month or so: good news. Details emerged surrounding a clinical trial for what is, right now, the Holy Grail of drug development: a COVID-19 treatment in the form of an antiviral known as Remdesivir.

The leaked information says that the phase 3 drug trial, staged at the University of Chicago, boasted “rapid recoveries in fever and respiratory symptoms.” Patients were actually brought to the point where they could be discharged in just under a week, which is a huge step forward. Sadly, two of the patients involved did pass away, but with most of the patients effectively cured, it's definitely a leap forward, and exactly the kind of leap forward necessary to get the world back on its collective feet.

And Yet, Some Urge Caution

A spokesman with the University of Chicago, meanwhile, immediately doused the parade—in the strictest metaphorical sense—by noting that the data was partial, the trial was ongoing, and despite the results seen so far, absolutely no conclusions should be drawn from it.

Regular humans, meanwhile, cheered the news and bought Gilead stock at a frantic pace.

The trial was built around 125 patients, all of whom had the COVID-19 virus. 113 of these were classified as “severely ill”. Further trials are set to follow, including a trial involving patients with “moderate symptoms” in May, and later this month, another trial involving patients with “severe cases”. Ultimately, reports suggest, Gilead is planning to set up trials using 4,000 test subjects.

They're Not Alone in the Field, Though

The biggest downside that Gilead Sciences faces in this arena is that there are a whole lot of other firms chasing after the same brass ring. While this is great for consumers, who will hopefully ultimately have a choice in coronavirus drugs available at prices that won't break the bank—kind of like cold medicines—it's not exactly great for the companies that are blowing a wad on what amounts to concurrent development.

Some reports suggest as many as 21 different companies are currently working on either vaccines or treatments, and that's alongside hydroxychloroquine, which has been available for decades. The good news, at least for Gilead, is that most of those are either behind or well behind Gilead's own efforts. Many of the 21 are at the preclinical stage, while others have advanced into Phase 1 testing. Gilead is in Phase 3 clinical trials, so it's definitely at the front of the pack. However, even here, there are others who are close; Sanofi (NASDAQ: SNY), for example, along with Regeneron Pharmaceuticals (NASDAQ: RAGN) has a treatment that's at Phase 2 / 3 clinical trials in its Kevzara drug. It's described as a “randomized, double-blind, placebo-controlled trial” with around 400 patients, so that should be a doozy when it concludes. Roche Holding AG (OTCMKTS: RHHBY) has a Phase 3 trial treatment as well in Actemra.

Gilead is definitely one of the farthest along so far, and the sooner it can get more trials done, the closer we are to an effective treatment. Or may even be there already thanks to hydroxychloroquine. Having a choice of medications to work with will also be helpful, even if it won't exactly mean a big winner in share prices for the company that comes up with the fifth of seven available treatments.

Either way, though, COVID-19's days do seem to be numbered, a development which can't happen too soon, given the sheer scale of economic damage it's done to the world so far.