When Pfizer (NYSE: PFE) and Moderna (NASDAQ: MRNA) announced the results of their coronavirus vaccine clinical trials late last year, public health experts were blown away. With both vaccine formulas sporting an efficacy rate of over 90%, health officials were quick to proclaim that a quick rollout could be the ticket to a return to normalcy.
There's just one problem: The vaccine rollout has been anything but quick. Both Pfizer's and Moderna's formulas come with strict cold storage requirements. That, combined with limited availability, has made widespread distribution of vaccines both slow and challenging.
But now there's a new player in the coronavirus vaccine field -- Johnson & Johnson (NYSE: JNJ). And it could be just the thing that expedites the mass vaccination process and helps nip the pandemic in the bud.
A real game-changer
Johnson & Johnson's coronavirus vaccine differs from Pfizer's and Moderna's in that it's not an mRNA vaccine. And while its initial efficacy rating comes in lower than those of Pfizer and Moderna, Johnson & Johnson's vaccine still does an extremely good job of preventing hospitalization and severe disease. Let's also not forget that Johnson & Johnson's clinical trials happened after Pfizer and Moderna's, at which point there were already more COVID-19 variants in circulation. As such, it's difficult to directly compare the different vaccine formulas.
But one thing we can compare is the complexity of getting those vaccines out to the public. In this regard, Johnson & Johnson has a clear advantage. For one thing, its vaccine doesn't have the same cold-storage requirements as Pfizer or Moderna, so the logistics of distributing it are easier in that regard. But an even more notable leg up is that the Johnson & Johnson vaccine is a single-dose shot, whereas the Pfizer and Moderna vaccines require two separate doses, spread out by three weeks and four weeks, respectively.
From a logistical standpoint, a one-dose vaccine is easier to administer. And from a public health perspective, it's preferable, as it confers immunity more quickly.
Furthermore, there may be less resistance to getting a one-dose vaccine than a two-dose regimen. Many workers aren't enttield to paid time off to both go get a vaccine as well as recover from one (although some employers are, in fact, paying workers to get vaccinated). To go through that process once, versus twice, removes a clear barrier.
How will a one-dose vaccine impact real estate investors?
Real estate investors have been hurt by the pandemic in many ways. Those with investments in office buildings or REITs (real estate investment trusts) with office buildings in their portfolios have been battered by the widespread remote work trend. Meanwhile, many mall REITs have lost value as retail stores have shuttered in full force due to a lack of consumer foot traffic.
The hospitality industry has also gotten hammered. Roughly 110,000 restaurants have closed permanently over the past year, leaving commercial landlords with a host of vacancies on their hands. And last year, hotels saw record low occupancy and revenue.
If the Johnson & Johnson vaccine helps speed up mass inoculation efforts, it could help all of these industries recover. Once more people are vaccinated, workers can more safely return to office buildings, and consumers can feel more comfortable shopping in stores.
Meanwhile, restaurants could get the green light to start operating at full (or at least increased) capacity, and travel could really pick up, leading to a major hotel revival. All of this would leave real estate investors in these areas in a much stronger position compared to now.
While there's currently limited supply of the Johnson & Johnson one-dose vaccine, the company recently announced a partnership with fellow pharmaceutical giant Merck (NYSE: MRK) to expand manufacturing capacity. That could, in turn, move up the timeline for mass vaccinations -- and get the U.S. one step closer to returning to a pre-pandemic existence.