Flu season is upon us, peaking in the coming weeks. During this time, media hype may meet legitimate concerns over strains of influenza type A including H1N1 (commonly known as swine flu) and H5N1 (commonly known as bird flu). Recent news of a severely virulent strain of flu genetically engineered by researchers may further spark traction of flu related stocks. The public’s knowledge of how pathogenic viruses such as the flu spread, are prevented and are treated has improved in recent years though many still do not heed CDC recommendations for vaccination.
Vaccination remains the most efficient method of pandemic control when the CDC and international monitoring systems correctly predict the strains of flu which will spread and/or mutate year to year. Our seasonal flu vaccines typically contained a strain of influenza B, a less virulent strain, and one influenza A strain. Recently, H1N1 was added to our seasonal flu vaccine, such as that provided by Novavax (NASDAQ:NVAX), which has recent buzz for insider buying and being undervalued.
The Science of Sickness
It is true that one cannot get the same virus twice, but a one-time vaccine is not enough to prevent flu infection during a lifetime such as a small pox vaccine. The trouble with the “flu” is that it is constantly evolving, mutating and our own immune systems actually select for strains which are more pathogenic year to year. Typically, our immune system is in a struggle with viruses similar to an arms race, or what geneticist Matthew Ridley called “The Red Queen Hypothesis” in reference to the character is Alice in Wonderland who was always running around to stay in one place. Just as with an arms race however, one side can gain the upper hand. When a virus changes hosts, from say a chicken to a human, there is little if no natural, effective immune response to deal with the novel virus. Further, vaccinations are based on predictions of strains which will circulate in any given flu season. With evolution, there is never certainty in this matter. In these situations, an immune boosting “trump card” such as interferon treatment may be in the last line of defense. While all humans make interferon, the levels in the body, especially when under attack by novel viruses, are not adequately effective.
The Asian Front
Currently, H5N1 is not communicable from human to human contact. Direct contact with an avian species is required. However, as viruses are constantly mutating, it is possible for H5N1 to evolve and be spread through human contact. In this event, vaccination would be key if time permitted. Asia has been a spotlight of H5N1 concern due to cultural and economic proximity to birds. Chinese Sinovac (NASDAQ:SVA) currently holds the only H5N1 vaccine, Panflu ®, stockpiled by the Chinese government. The stock has been steadily declining this year, but could see a certain jump if H5N1 fears in Asia return. Further, being given the reigns to a large market such as China would be a boon during this time.
Should Interferon Receive More Attention?
While vaccination is plausible for many areas where it is economical and logistical, many areas of the world, especially those most prone to transmission of communicable disease from animal to human and human to human may not have the resources for vaccination. Even in the resource sufficient U.S. the CDC reports only a 36.2% of adults had been vaccinated by mid flu season 2011-2012. It is clear that effective pandemic control must include effective treatment past the vaccination stage. A 2011 study showed that in lieu of vaccination, low dose oral treatments of alpha interferon were effective against both H1N1 and H5N1 strains of influenza. Hemispherx Biopharma, Inc. (NYSEMKT:HEB) has seen some progress on clinical trials on its Alferon ® Low Dose Oral (LDO ®) interferon. In the event of pandemic panic, this cost effective agent could provide both treatment and prevention, though this stock is speculative. Genentech’s Tamiflu ® is still the major player in treatment and should continue to offer parent company Roche (OTCQX:RHHBY) an added boost to its already solid portfolio. However, Tamiflu® is more specialized and interferon treatments offer a broader range of viral protection. Moving into the next few years however, I would not be surprised to see more attention focused to infectious disease related low dose oral (LDO ®) interferon production as the risk of pandemics will only grow with a more globally accessible world.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.