Aspen shares spike on news of coronavirus drug breakthrough
DURBAN – Aspen Pharmacare on Wednesday said it was watching developments surrounding the potential coronavirus drug with keen interest, as it had it at affordable rates.
Aspen said it could produce dexamethasone at cost – making the steroid affordable immediately to save critically ill Covid-19 patients.
Aspen’s executive for strategic trade development, Stavros Nicolaou, said the tacit endorsement of the drug by the World Health Organization (WHO) was encouraging for the company and the continent.
Nicolaou said the drug was easily available over the counter in South Africa.
“Dexamethasone is available in multiple markets, including South Africa, and is manufactured by a third party locally in Port Elizabeth,” Nicolaou added.
“The development is pleasing for Aspen as we support the government’s efforts in the fight against the pandemic. We held a meeting with the departments of Health and Trade and Industry to supply the drug in the rest of the continent,” he said.
The probability of the drug’s use to treat Covid-19 sent Aspen more than 10 percent higher on the JSE yesterday after the WHO welcomed its use as life-saving for patients who are critically ill with Covid-19.
The WHO said on Tuesday that initial clinical trial results from the UK showed that dexamethasone, a corticosteroid, revealed that for patients on ventilators, the treatment helped to reduce mortality by about one third and for patients requiring only oxygen, mortality was cut by about one fifth.
Currently, the regulated price of a dexamethasone injection in the country was between R149 and R176.
Nicolaou said that the drug was easily available as a tablet and an injection.
“Dexamethasone is not a new drug, and it has been used to treat other inflammatory illnesses. We are confident that the group will be able to meet the demands if the country requires more of the product,” Nicolaou said.
Dexamethasone is used to treat many different conditions, such as allergic disorders, skin conditions, ulcerative colitis, arthritis, lupus, psoriasis and breathing disorders.
Jordan Weir, a trader at Citadel, said the momentum due to the news of dexamethasone as a potential drug against Covid-19 had brought relief in the market.
Weir warned that although the drug was a breakthrough with a regulated price of between R149 and R176, the margins made on the injection for treating the virus were not material enough to justify a radical move higher for the company’s earnings and share price in the longer run.
Aspen shares gained 9.29 percent on the JSE on Wednesday to close at R153.