The end of the pandemic could finally be in sight after US pharmaceutical giant Pfizer said its Covid-19 oral antiviral pill Paxlovid could be a ‘game changer’ that reduced the risk of hospitalisations and death by 89% in high-risk patients. Add that to the existing mass-market vaccines and the pharmaceutical industry looks to have won the war against Covid-19.

Pfizer will apply for emergency use of the pill which means it could be available before Christmas. Its shares gained around 9% on the news. The company is also studying the treatment’s impact on low-risk patients.

The news prompted widespread euphoria in sectors beaten up by the pandemic with US airline stocks and travel companies seeing big gains on the day as their earnings prospects in theory will improve as there will be broader treatments to fight against Covid-19.

Shares in cruise ship operator Carnival (CCL) advanced 8% on the day of the Pfizer news, Asia Pacific airline stocks gained around 5% while luggage manufacturer Samsonite International surged 14%.

Going in the other direction were shares in biotech company Moderna which plunged 17% as investors feared its relatively high-priced injectable Covid-19 vaccine might be less attractive compared with an oral equivalent.

The fall will have caused collateral damage to investment trust Scottish Mortgage (SMT) which recently highlighted that Moderna had become its biggest holding and largest contributor to its annual performance to the end of September 2021.

The Pfizer breakthrough comes hot on the heels of the first oral Covid-19 antiviral pill developed by US pharma peer Merck and its partner Ridgeback Biotherapeutics. The UK government has ordered 480,000 doses of Merck’s drug Molnupiravir and 250,000 doses of Pfizer’s Paxlovid.

The reason investors are so excited about the Pfizer pill is because its high efficacy rate is on a par with existing injectable vaccines on the market and significantly higher than the Merck oral tablet which is around 50% effective.

In addition, the treatment, which involves a five-day course of tablets, is likely to have a higher acceptance rate among the general population than injected vaccines because of its convenience and home setting use.

Ultimately, the tablet has huge potential to save lives and quicken the pace of global recovery. Pfizer has indicated that poorer countries will pay less for the course of tablets.

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