Gritstone Oncology Inc. (NASDAQ: GRTS) pushed higher on Tuesday after the company reported that it was advancing the development of a second-generation vaccine against SARS-CoV-2 with potential for both prolonged protection and potency against Spike mutants.
Gritstone and the National Institute of Allergy and Infectious Diseases (NIAID) entered into a clinical trial agreement to initiate clinical testing. A Phase 1 clinical trial, expected to be conducted through the NIAID-supported Infectious Diseases Clinical Research Consortium (IDCRC), is in development. The Bill & Melinda Gates Foundation is supporting the preclinical evaluation of the vaccine.
The company received a grant from the Gates Foundation to support the preclinical evaluation of the vaccine. NIAID is supporting development of the Phase 1 clinical trial through the IDCRC.
As it stands, Gritstone is developing a novel vaccine against COVID-19, containing Spike (similar to first generation vaccines) but also additional viral epitopes that offer good targets for T cell immunity. The company is using both self-amplifying mRNA and adenoviral vectors to deliver the SARS-CoV-2 viral antigens. The vaccine may have pan-SARS/coronavirus potential to protect against future coronavirus pandemics.
This vaccine may provide more comprehensive viral protection by inducing a better combination of T cell responses and neutralizing antibodies as compared to the currently available vaccines, according to Gritstone’s management. It is important that the firm moves forward with developing these next-generation vaccines because it does not yet know whether the existing vaccines that have been granted emergency use authorization will provide long-term immunity or prevent transmission. Improved vaccines that can accomplish these additional benefits may be needed to continue mitigating the ongoing pandemic.
Excluding Tuesday’s move, Gritstone had underperformed the broad markets, with its stock down about 41% in the past year. However, in the past six months, the stock was up closer to 68%.
Gritstone stock traded up about 44% to $9.21 on Tuesday, in a 52-week range of $2.54 to $11.49. The consensus price target is $11.25.
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