VIR Stock – Why Vir Biotechnology Stock Is Falling Today
Shares of Vir Biotechnology (NASDAQ: VIR) are dropping sharply on Thursday despite the drugmaker not reporting any news. We can probably attribute the stock’s decline to a Wall Street analyst deciding to lower his price target on Vir Biotechnology. As of 12:23 p.m. EST, shares of the company were down by 12%, after falling by as much as 16.2% earlier in the session.
Goldman Sachs analyst Paul Choi lowered his price target on Vir Biotechnology from $61 to $59. The analyst did keep a buy rating on the stock. But this development piles on the bad news that Vir Biotechnology released yesterday. As a reminder, Vir Biotechnology and its partner GlaxoSmithKline are taking part in the Accelerating COVID-19 Therapeutic Interventions and Vaccines (ACTIV) Program, an initiative led by the U.S. National Institutes of Health (NIH).
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Yesterday, the two companies announced that the independent Data and Safety Monitoring Board (DSMB) recommended that the VIR-7831 arm of the ACTIVE-3 trial be closed to enrollment. VIR-7831 is an experimental COVID-19 therapy that Vir Biotechnology is developing in collaboration with GlaxoSmithKline. The DSMB’s recommendation came after a sensitivity analysis of the data from the trial led to concerns regarding the efficacy of the treatment.
This news is what prompted Choi to lower his price target on Vir Biotechnology’s shares. But the $59 target still represents significant upside for the biotech stock, given that after the sell-off of the past couple days, its shares are trading for just $36.45. Should investors pull the trigger?
Note that the company has no products on the market, and VIR-7831 is currently one of its leading pipeline candidates. Whether this therapy goes on to earn regulatory approval is, at this point, anyone’s guess. For those reasons, Vir Biotechnology seems like a risky bet.
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Prosper Junior Bakiny has no position in any of the stocks mentioned. The Fintech Zoom has no position in any of the stocks mentioned. The Fintech Zoom has a disclosure policy.
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