Evonik coronavirus vaccine capabilities could net big payday - bank

Author: Tom Brown


LONDON (ICIS)--Evonik’s dominance in a technology space necessary for the administration of the newer class of vaccines against Covid-19 could significantly buoy the German producer’s earnings over the next five years, according to Baader Bank.

The Germany-based firm has a strong market position in lipid nanoparticles necessary for the transportation of messenger RNA (mRNA) vaccines such as those developed to fight the coronavirus pandemic by Pfizer/BioNTech and Moderna.

A new form of treatment, mRNA-based vaccines train the body’s cells to produce a protein triggering an immune response, rather than using an inert or weakened form of a bacteria to drive the immunisation process.

Thee lipid-based nanoparticle coating is a way of ensuring the mRNA within the vaccine reaches the right part of the body without biodegrading.

UK chemicals producer Croda also has competencies in the space.

Other coronavirus vaccines in development such as the AstraZeneca/Oxford University are significantly cheaper and do not require specialised laboratory freezers for storage and transportation, meaning those older forms of treatment are more likely to be utilised in the developing world.

The scale of the demand for vaccines and the billions of people that need to be treated to draw a line under the pandemic era means that Evonik could see this specialised part of its operations become a significant revenue driver through to 2025, potentially accounting for 2% of revenues, Baader said.

The group’s parenteral drug delivery unit could see sales grow from the low- and mid-double digits to around €300m by 2025, the bank projected.

“The market has not fully understood the upside of Evonik’s innovative product portfolio and the potential organic growth out of it,” the analysts concluded.

Front page picture: The Pfizer/BioNTech vaccine being administered to health workers in Edinburgh, UK on Tuesday
Source: Andrew Milligan/AP/Shutterstock