Ebola virus (Shorts and Longs)

[TheMotivatedTrader]

Ebola Stocks on the Rise as Death Toll Hits 5,000

http://finance.yahoo.com/news/ebola-stocks-rise-death-toll-171800482.html

NEW YORK, NY / ACCESSWIRE / December 1, 2014 / The death toll from the current Ebola outbreak has nearly hit 5,000 according to the World Health Organization (WHO). While the spread seems to be thankfully slowing, the Ebola stock phenomenon has now transitioned from fear-based speculative buying to concrete capital flows. Lakeland Industries (NASDAQ:LAKE), after surging on the mere news of Ebola and speculation that this would increase demand for the company's hazmat suits, is now surging again on the news that, indeed, the suits are starting to sell. Lakeland last week announced total orders of over one million Ebola suits from both government agencies and private sector customers. Sales will be accretive to earnings after January 31, 2015.

To give an idea of how fast this is going, Lakeland only first announced global availability of hazmat suits designed for Ebola on September 12th, less than two months ago.

Lakeland Competitor Alpha Pro Tech (NYSEMKT:APT) has yet to announce any large purchase orders for its suits in the wake of the torrent of Ebola news, but if and when an announcement is made, expect a large jump in Alpha's share price. The longer Ebola stays in the spotlight, the higher the chances that Alpha will soon take a slice of the pie, if it hasn't already done so pending an announcement.

That said, the latest developments on the epidemic are as follows:

1. A UN health worker with a confirmed case of Ebola has been flown to France for treatment.

2. A potential Ebola patient in North Carolina that developed a fever after returning from Liberia has preliminarily tested negative for the disease.

3. New York City Ebola patient improves, while a suspected case in Oregon is considered "low risk".

While Lakeland has already landed a major order with more likely to follow, newcomer Naturalnano (OTCMKTS:NNAN) has surprisingly also signed a purchase order with a California hospital, though the size of the order has not yet been disclosed. Naturalnano saw a volume spike to 107M shares traded from an average of 5M on the day it announced the order. Shares spiked over 300% in one day.

Hazmat suit companies are by no means the only stocks that should be monitored as Ebola developments continue to pepper the news. In fact, Big Pharma started turn its head on the issue back in August. On August 28, GlaxoSmithKline (NYSE:GSK) announced that it is developing an Ebola vaccine candidate together with the National Institutes of Health (NIH). The science of the vaccine is based on inserting an Ebola virus gene into a nonlethal vector virus, thereby having the immune system recognize Ebola genes without the threat of infection. Phase 1 trials began in mid-September and results are expected at the end of the year.

A successful Ebola vaccine could possibly see governments adopting it as mandatory in the West , considering the level of fear of the virus among the public. The fact that Glaxo is teaming up with the NIH on the treatment is a sign in that direction. We will know more with the publication of phase 1 results by the end of the year. Unlike the Hazmat suit companies above, Glaxo stock has not directly reacted to any Ebola news since the outbreak began in West Africa. Nevertheless, this vaccine warrants attention.

Glaxo, however, is not the only company developing an Ebola vaccine together with a Western government. Newlink Genetics (NASDAQ:NLNK), a midcap, is developing one with the Canadian government using a similar approach. Newlink is on a similar timeline to Glaxo on development of this vaccine, named VSV-EBOV. VSV-EBOV works by crossing Ebola genes with a virus that infects cattle but not humans. These viruses then express Ebola proteins, which would in theory prime the immune system to fight the real virus. A single injection of this vaccine was shown to provide complete immunity to Ebola in primates. Whether that translates to humans is the big question. In the meantime, Newlink is up 36% in one month.

Ironically, the Ebola vaccine that has been covered most extensively in the news, ZMAPP, is precisely the one that has yet to begin human testing according to the CDC. ZMAPP is a monoclonal antibody rather than a vaccine that provides active immunity. The drug itself attacks the virus directly instead of training the immune system to do so. Supplies of ZMAPP have been exhausted.

Perhaps even more strangely, there is an Ebola drug that has been approved, though not by the FDA. Avigan is an antiviral designed against the flu but seemingly effective against Ebola developed by Toyama Chemical in Japan and approved by Japanese regulators in March. Toyama Chemical is a subsidiary of Fujifilm (OTCMKTS:FUJIY).

So after all is said and done, there is in fact an approved treatment for Ebola, but it's in Japan.

It should be noted that since this epidemic began, no Americans have died of Ebola Virus Disease. In other words, the effective American survival rate of Ebola is 100% so far. Yet even so, orders for Hazmat suits and demand for more effective treatments will continue to rise along with Ebola stocks, so long as Ebola remains a meme on the news. And while the spread of Ebola seems to be ebbing off, hospitals and governments may still want to be prepared for the next outbreak should it occur. Meaning, vaccine development and hazmat suit purchases will most likely not cease when the current Ebola wave is finally over.

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