BioNTech SE (Nasdaq: BNTX) closed a €100 million debt financing agreement to support the development of the company’s COVID-19 vaccine program BNT162. The capital helps ensure that the company can expand its manufacturing capacity to supply the vaccine quickly worldwide in response to the COVID-19 pandemic. Although the company has partnered with Pfizer, this deal will enable BioNTech to manufacture the vaccine at risk while ongoing clinical trials continue. BioNTech is the first European company to enter clinical tests of a COVID-19 vaccine product: they initiated a study in Germany in April and an additional trial in the United States at the beginning of May. The BNT162 campaign includes four vaccine candidates being tested in parallel, making it one of the broadest development programs worldwide.
Like Moderna and Curevac, BioNTech’s BNT162 is a class of mRNA-based vaccine that consists of genetic material known as messenger RNA, that provides instructions for a human cell to make a target protein, or immunogen, which activates the body’s immune response against the respective virus. The goal of a vaccine is to stimulate the immune system to generate protective, long-lasting antibody and T cell responses against SARS-CoV-2 and prevent subsequent infection upon exposure to the virus. mRNA vaccines are a potent new development class of vaccine with the potential for high versatility and favorable safety properties. For example, the company was able to bring the first vaccine candidates from concept into clinical testing in less than three months.
The EIB debt will be disbursed in two traches of €50 million each, following completion of pre-defined milestones.
What groups are behind this deal?
The EIB is backed by the European Fund for Strategic Investments, the financial heart of the Investment Plan for Europe, in which the EIB and the European Commission partner to direct investment for EU priority projects. It also benefits from InnovFin Risk Sharing for Corporate Research backed by Horizon 2020, the EU Framework Program for Research and Innovation.
Hedge Funds Making Bets
Apparently, according to Insider Monkey’s research, there has been significant growth in hedge funds positions in BioNTech. By the end of Q1, 6 of these prominent hedge funds had taken long positions in this company’s stock—including 50% since the fourth quarter of 2019. Could this be because of the company’s underlying platform and Pfizer deal?