Thought Leadership  •  June 01, 2020

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Honeypot Field to Catch Bots
Honeypot Field to Catch Bots

All great changes are preceded by chaos.

Presented by DFIN in coordination with Treehill Partners.

Treehill Partners is an experience driven financial advisor exclusively serving clients in the healthcare industry.

Response to the Covid pandemic will hopefully cause lasting change.

The world of healthcare has been turned upside down. The COVID-19 pandemic has taken healthcare systems across the globe to breaking point, with hospitalization rates never before seen and hundreds of thousands of fatalities. While the immediate crisis was characterized by lack of personal protective equipment, ICU equipment and diagnostic kits, the focus has now turned onto the need for effective therapeutics and prophylactic vaccines. The life science sector responded to the challenge as well as to the sudden availability and priority of covid-19 funding. Easy money has lots of takers.

A search of identifies almost 1,650 trials (and globally there will be more), which must have listed over the past 4 months, an incredible rate of investigation. The downside, as pointed out for example in a recent British Medical Journal article1, is the waste, and low intrinsic quality of research that has emerged in many of these studies and other research related to Covid-19. In our haste to respond to the crisis, governance over resource utilization and in some cases scientific rigor have declined.

Strong coordinated initiatives exist. In the US, BARDA has repurposed its TechWatch program to have an exclusive focus on Covid-19 medical countermeasures2.  The NIH and the foundation for the NIH announced the creation of ACTIV (Accelerating COVID-19 Therapeutic Interventions and Vaccines), a public private partnership involving over a dozen pharmaceutical companies3. Furthermore, BARDA, NIH and CDC have received over US$ 8 billion in COVID-19 relief funding between them4. Outside the US, the Coalition for Epidemic Preparedness Innovations (CEPI)5, launched in 2017, has stepped up its COVID-19 focused funding activity, investing significantly in the primary COVID-19 therapeutic and vaccine programs.

So, when can we truly expect the emergence of effective therapeutics and vaccines? While it is true that new drug development can take more than a decade, repositioning of existing drugs, with known safety profiles and mechanisms of action that would make sense in the new setting, can speed up the process. We have alluded to this in our previous article. In this way Gilead’s Remdesivir garnered Emergency Use Authorization after a short trial showing that it could shorten the time to recovery in some patients6. Criticism of this approach was not limited to pointing out that this early approval may mean that the true efficacy of Remdesivir may never be established because trials will no longer be allowed against placebo. However, more work on identifying efficacy amongst already approved drugs should be done since truly new drugs will take a long time to come to market, and history is littered with low efficacy antivirals, so the probabilities of success are low.

A vaccine approach perhaps offers more hope. As of mid-May, 8 potential vaccines are in clinical development with another 110 candidates in preclinical evaluation7. One of the most advanced is that of Moderna which is entering phase 2 and expects to start phase 3 in the summer. Getting into advanced trials so quickly has beaten all records and has been facilitated in part because vaccines are often based on validated platforms (a little like repositioning existing drugs). However regulatory flexibility and prioritization has played and will continue to play a significant role. Legislative changes, perhaps less visible, also enable rapid development. The HHS recently updated the PREP Act to issue a Notice of Declaration which confers liability immunity for those developing medical countermeasures against COVID-198. One less thing for developers to worry about.

The efficacy needed to consider prospective vaccines useful was recently discussed by the WHO9. They published that while 70% efficacy for a new COVID-19 vaccine is desirable, since this level would be needed to generate herd immunity, 50% may be acceptable in the near term. Nevertheless, to demonstrate that even a 50% efficacy endpoint is achieved will require a trial with perhaps tens of thousands of participants. As multiple trials are launched and as community infection rates decline the impact on approval timelines are unclear. If safety and seroconversion were acceptable endpoints for initial approval, development would be accelerated further.

Aside from development, manufacturing and supply chain issues need to be resolved to ensure a vaccine is available to the population once approved. And then there is the question of how many vaccines are needed? What if all 8 provide similar benefit? Competition is healthy and having redundancy is advantageous as it mitigates a number of risks, but vast sums of money are being spent and company valuations have risen sharply based on early promise. It remains to be seen how this market, non-existent 4 months ago will evolve.

Treehill Partners is an experience driven financial advisor exclusively serving clients in the healthcare industry. For more information, visit

Footnotes and references
1 BMJ 2020;369:m1847 (
2 As of March 31 (
3 ACTIV announcement in JAMA (
4 CARES Act (
5 CEPI Launch (
6 Remdesivir EUA (
7 WHO landscape of COVID-19 vaccines (
8 Update to the PREP Act(
9 WHO COVID-19 vaccine R&D update (