Clinical trials troubled amid coronavirus outbreak, drug sales not so much

Anecdotal reports of clinical drug trials being disrupted by the coronavirus outbreak have caused concern for the life sciences sector at large, though it appears vaccine trials for COVID-19 won’t be affected, according to Moody’s.

In a note Wednesday, the financial services company said that pharmaceutical companies pausing or delaying clinical trials have had a negative impact on contract research organizations (CROs) — and could hurt earnings for several quarters.

Restrictions in travel in various parts of the country and world have resulted in “far more delays and temporary suspensions of clinical trials, due to the logistical challenges presented by local travel limitations in many countries where clinical trials are run; but Moody’s analysts expect outright trial cancellations to be limited but will rise if travel and other restrictions extend into the second half of the year.”

Moderna (MRNA), which has the first coronavirus vaccine candidate in trials, said that while other trials were impacted by restrictions in movement, the vaccine trial is likely to continue to be able to enroll participants.

Similarly, Johnson & Johnson’s (JNJ) Chief Scientific Officer, Paul Stoffels, told Yahoo Finance he does not see an issue with the company’s vaccine candidate.

“What will be the more challenging question [is] how fast can we do getting the vaccine in clinical trials for efficacy. We will have to follow where in the world the epidemic is happening in order to do a prevention study and we’ll have to recruit very fast,” he said.

Meanwhile, pharmacies could also see a dampening, though modest, demand due to business disruptions for health care providers, according to Moody’s.

But, the authors noted, that the the ongoing demand for prescription drugs — especially for chronic care— should balance the negative effect.

“We generally expect that any reduction in the industry’s revenue will be limited to mid-single-digit percentages during 2020. The medical necessity of most prescription drugs and ongoing patient access to pharmacies and mail order will help buffer the reduction,” according to the note.

Anjalee Khemlani is a reporter at Yahoo Finance. Follow her on Twitter: @AnjKhem

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