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Deadly Saudi MERS-CoV Global Pandemic Bio-tech Stocks Profit Potential

Companies / BioTech Jun 17, 2013 - 02:39 AM GMT

By: Money_Morning


Greg Madison writes: One of the really beneficial things about science is its power to transcend borders and ideologies. Scientists in countries that may be totally hostile to one another have the chance of collaborating on difficult problems in a spirit of openness.

This ability to collaborate and exchange information across borders is particularly important when a new disease with global pandemic potential emerges, as it has in the Middle East with the respiratory system coronavirus (MERS-CoV).

This "novel coronavirus" was identified in September of 2012 in the Saudi Red Sea port of Jeddah. The disease was found in a deceased 60-year old man who died of acute pneumonia and kidney failure. Little else is known of this unfortunate individual.

A Scary Bug
MERS-CoV is a scary bug. There have been 51 reported cases radiating outward from the Arabian Peninsula, from Saudi Arabia, Jordan, Qatar, the United Arab Emirates, and Tunisia, out to Germany, France, and Italy. The death toll presently stands at 30, giving an informal "mortality rate" of more than 50%. The overwhelming majority of those deaths have occurred in Saudi Arabia.

Which is why the deafening silence coming from Saudi Arabia's Ministry of Health is troubling - if not downright scary. World Health Organization scientists seeking to tackle the problem desperately need any data the Saudis can provide

But Scientific American has reported that the Saudi health ministry has done little except announce new cases and report deaths from MERS-CoV. Even basic patient information like age, sex, pre-existing conditions, co-morbidity, and any other factors are left out of the Saudi reports

Early indications are that MERS-CoV does not spread easily from person to person... yet. When viruses are concerned, evolutionary leaps and bounds happen in the (relative) blink of an eye. This has the WHO worried.

Millions May Be Headed For The Epicenter
And there is good reason for worry. Global air travel is a huge problem when dealing with any pandemic, for obvious reasons. The free flow of people means the free flow of disease, but only rarely do people fly directly into the epicenter of a pandemic.

Yet, we're less than one month away from the Muslim holy month of Ramadan. Ramadan coincides with a huge influx of religious tourists to Saudi Arabia, as millions of pilgrims arrive from all over the world to take part in the Umrah and Hajj rituals practiced by observant Muslims. These pilgrimages are among the largest single movements of humanity, and they happen every year. During the pilgrimage, the great throngs of human beings are visible by satellite.

During these rituals, pilgrims from every continent,from more than 150 countries, live, eat, and worship for weeks in communal, necessarily primitive conditions in the desert outside the holy city of Mecca.

This year, these pilgrims could be walking into a very dangerous situation indeed. During any "routine" pilgrimage season, if anything like this could be called routine, the Saudi government faces enormous logistical challenges in accommodating the millions of tourists. Mix in a potentially lethal pandemic to the equation, and a timeless, sacred ritual turns ugly very quickly.

The disease need not strike pilgrims first. In addition to being the gateway to Mecca, Jeddah is an ancient Red Sea port. Ships come and go, day after day after day, as they have for centuries. Cosmopolitan Jeddah ties the Arabian Peninsula to East Africa, the Indian subcontinent, and China beyond. Billions of people have indirect exposure to anything that happens in that city.

Most Saudi oil is exported from three major ports on either the Red Sea or the Persian Gulf; Ras Tanura, Ras al-Ju'aymah, and Yanbu. Tankers leave these facilities for destinations all over the world. Any one of those tankers could potentially carry MERS-CoV to the outside world.

More Questions Than Answers
To be clear, there is absolutely nothing special about Saudi Arabia or its people that makes it more or less prone to be the origin of this virus. It's just a diabolical luck of the draw, and there's every chance that it was a case of a person coming into contact with an infected animal, a case of zoonosis - something that happens all over the world as the human population expands and wild habitats shrink. There are far more dangerous things than hungry bears and angry spiders out in the wilds.

It would be irresponsible to say that MERS-CoV will definitely become a global health crisis. The WHO just doesn't have enough information to make that determination. MERS-CoV's communicability rate, whether or not it can spread through sustained contact, even its method of infection, are all huge gray areas.

The WHO is very concerned about it, while other scientists just aren't. This split decision is thanks in part to the unwillingness of the Saudi health ministry to open up about the facts. What we're left with is a limited body of evidence, some precedent, some (very) educated guesswork, and potentially deadly unanswered questions.

That's not a great way for scientists to fight a disease, especially one with the ghastly potential of MERS-CoV. A situation where people flow freely while information is withheld is a nightmare scenario for disease fighting.

Back To The Future
If anything, scientists may have to go back to the future, and take a hard look at at the SARS-CoV outbreak which occurred in the early part of the last decade. SARS-CoV was a coronavirus, like this new emerging threat, and it did spread widely across the planet, though it caused (relatively) few deaths. Coronaviruses infect both humans and animals, and in many cases, humans only get sick once the virus - endemic in such and such an animal population - makes the jump to an unlucky human. The most well-known of the coronaviruses is the common cold, something that most of us have experienced at one time or another.

The SARS outbreak brought renewed research into coronaviruses. The disease caught the world with its collective pants down. It was a global threat, and there was no therapy in place besides evaluating each patient and moving on from there.

Some companies are working on direct vaccines, while others are working on genetic therapies. Scicasts reports that the latter approach involves tweaking the way specific human organs, like the lungs and respiratory tract, react to the havoc that these viruses can wreak on them. A lot of these options are a lot more feasible now than they were just 10 years ago, but there's still a lot of ground left to cover.

Those looking for a way to fish the murky waters of research investment might do well to cast a wide net. Hunting for individual biotech stocks, usually small caps, can be a frustrating proposition.

But there's always the iShares NASDAQ Biotechnology ETF (Nasdaq:IBB). This ETF has exposure to a huge array of biotech stocks across the entire sector, more than have of them big-caps. And it's a strong performer as well, with convincing 52-week performance running from $121 to about $187. The ETF currently sits at around $178 or so, with some room to run. It's actually up 29% over the past six months.

What do you think will happen with the #MERS virus? Should we expect the worst? Sound off on our Twitter page, or drop us a line on Facebook.

Source :

Money Morning/The Money Map Report

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