Think about the service this company has done mankind. C. diff, as hospital diarrhea is called, is a growing cause of hospital deaths. Though many cases outside of hospitals are never diagnosed, we know it kills at least 30,000 Americans annually. Those who do recover, about 9 out of ten, can suffer horribly for months. Bravo to Medarex and all those who made this breakthrough possible by investing your money in this incredibly worth effort.

So what does this have to do with swine flu?

So far, swine flu is a minor problem compared to C. diff. Only one person in the U.S. has died from the infection. Survival rates, in fact, are far higher than they are for C. diff. Still, it could get worse, and governments are looking for a vaccine. So, just what are the financial opportunities?

I see nothing significant in the short run. One can never account for mob psychology though, and there have already been surges in some vaccine companies. In terms of fundamentals, however, I don’t think standard flu vaccines are going to make investors rich. The reason is that governments are the real customers for flu vaccines. On top of that, vaccines are an established industry and yields tend to be driven down by competition.

Those who are interested in playing swings should probably look into:

• Novavax  (NASDAQ: NVAX)
• Dynavax (NASDAQ: DVAX)
• Hemispherx Biopharma (AMEX: HEB)
• BioCryst Pharma (NASDAQ: BCRX)
• AVI BioPharma (NASDAQ: AVII)
• deCode Genetics (NASDAQ: DCGN)
• Crucell (NASDAQ: CRXL)
• Vical (NASDAQ: VICL)

This does not mean there are not long-term flu-related opportunities. Even if swine flu doesn’t turn into a major pandemic, influenza is a serious international problem that drains resources and lives. The World Health Organization, estimates that influenza infects 5 to 15% of the world’s population in a typical year. This results in 250,000 to 500,000 deaths. The WHO and the Centers for Disease Control and Prevention are, of course, concerned about the potential for a major global pandemic. Medical science has progressed significantly since 1918, when the “Spanish Flu” killed upward of 50 million people; but it is still a serious illness.

Right now, the headlines generated by the flu are largely about trying to track and stop its progress. Today, this is extremely difficult. There are, however, solutions on the horizon.

I’ve written before about biochip sensors. These are a true transformational technology. Last year, agricultural losses of hundreds of millions of dollars were caused by the inability to quickly locate the source of a salmonella infection. What is needed, and will arrive in the not-so-distant future, are sensors that can detect disease pathogens cheaply and instantaneously. Think Star Trek tricorders…

And we’re getting close. EETimes is reporting that CombiMatrix Corp. (NASDAQ: CBMX) has made biochips that can be programmed to identify any known flu type. CombiMatrix says its microarray can be updated for new influenzas in less than a day and can deliver test results in only four hours.

A little bit further out are even bigger profit opportunities. Specifically, we’re looking at is an end to specific flu vaccines.

Pandemic influenzas emerge from a sudden change in the flu virus against which there is no immunity. Vaccines are the mainstay of flu prevention, but they have two key limitations. First, they are developed against single, known flu strains. Therefore, they may be ineffective against new strains. Second, vaccines are produced using a lengthy process requiring incubation in chicken eggs. New flu vaccines take months or years to stockpile.

There are general antiviral medications approved to treat influenza. Influenza virus strains, however, can become resistant to these medications. For this reason, scientists are looking to RNA interference for a brand new approach to preventing flu viruses.

I know of at least two companies that have been engaged in the search for an RNAi flu cure. The potential advantage of RNAi antiviral therapeutics is that RNAi can be used to provoke an immune response that prevents replication of all influenza viruses, new or old. Stockpiling of an effective RNAi treatment would be possible in advance of a global pandemic and could be used for routine flus as well. Moreover, whoever produces the therapy would have a significant profit potential.

For transformational profits,
Patrick Cox

Source: Why Standard Flu Vaccines Won’t Make Investors Rich

This is not what a timid, cautious market needs as it works to heel from the wounds of a wicked leveraged correction. Fortunately, as with most media-hyped fears, the swine flu “pandemic” will be short lived.

In the meantime, traders will have their hands full picking the speculative winners from the losers. So far, the stocks investing are trading the most are no big surprise.

Just as they do every time the word flu creeps into a headline, shares of Novavax (NASDAQ:NVAX) are soaring today. Investors lucky enough to be holding shares last week, are now sitting on shares worth 150% more than they were trading for on Friday. Options traders are making plans for retirement as their positions soar multifold.

But even after this morning’s surge, shares have to more than triple in value to reach the peak levels of the bird-flu scare in 2006. You can view that as more upside potential, or look at it the way I do and realize the gains will not be long-lived.

Investing fever

Novavax, while it does not sell any cure-all pills or a vaccine to prevent the spread of the swine flu, does have the biotechnology to quickly uncover the recipe for a new vaccine. By grabbing shares of the tiny $100 million ($50 million last week) company, you are speculating the flu will grow to pandemic proportions and large doses of vaccines will be needed.

If that never happens, the future cash flows investors were betting on will dissolve and share price will natural drop back to last week’s levels.

If you are not willing to flat-out gamble on the situation, you will likely want to turn to companies like Gilead Sciences (NASDAQ:GILD), the creator of Tamiflu or Switzerland’s Roche, who is currently paying a royalty to Gilead for the right to sell Tamiflu. Or you can invest in GlaxoSmithKline (NYSE:GSK) and its Tamiflu competitor, Relenza.

Over the weekend, global health officials gave permission to tap into reserve stockpiles of Tamiflu and start using up to three million treatments as needed. Hopefully, the world will not need the entire amount as it could take Roche up to eight months to scale up its current production and put large amounts new packages of the flu-fighting tablets on the market.

Overall, Roche is expected to earn somewhere in the neighborhood of $400 million if it is called to restock current piles of Tamiflu. That means about $70 million in royalties could flow to Gilead, not a windfall by any stretch of the imagination for a $40 billion company.

If you do not already own shares of any of these companies, today is not the day to be doing it. Novavax could be a winning play if you time your moves exactly right, but the other handful of companies getting attention from the news will likely give up their gains as quickly as they came.

Until the headlines and the 24-hour news networks start talking about massive amounts of casualties and not a few folks with a high fever and weaker-than-normal stomach flu, this story is pure speculation and is not for traders that cannot tolerate ultra-high risk.

If you really want to make some money on the situation, buy a couple of pigs on the cheap. You’ll be able to fatten them up and sell them for a premium when this whole thing blows over.

Source: Swine flu: Investing in a Sick Pig