News

(Bloomberg) -- Shares of Danish vaccine developer Bavarian Nordic A/S jumped, while other medical product makers also rose, after the World Health Organization declared a fast-spreading mpox outbreak in Africa a global health emergency.

Bavarian Nordic, one of the few companies with an approved mpox vaccine, soared as much as 17% in Denmark to the highest intraday level since November 2022. Medical tools supplier Precision System Science Co. surged as much as 39% in Japan, while virus detection kit maker Shanghai ZJ Bio-Tech Co. gained as much as 8.4% in China.

Bavarian Nordic can provide 10 million doses of its vaccine to African countries by the end of 2025, Paul Chaplin, the Danish company’s chief executive officer, said in an interview. The firm has about 300,000 doses ready for shipping immediately.

Health-care stocks have reemerged on investors’ radars in Asia in recent days as Covid cases spike back up in parts of the region. The mpox outbreak adds another layer to their calculus on which of the sector players will quickly respond to the anticipated demand.

“The recent emergence of the mpox virus in Africa has the potential to evoke memories of the Covid-19 pandemic,” said Manish Bhargava, a fund manager at Straits Investment Holdings in Singapore. “Given the early stage of the outbreak, investors are expected to maintain a watchful stance, awaiting further data before reacting.”

A mutated strain of mpox — a virus that causes unsightly, painful rashes and lesions — has spread to at least six African countries, infecting about 15,000 people and killing more than 500 in the Democratic Republic of Congo this year alone. The variant was first reported in the DRC less than 12 months ago.

The WHO last called mpox a public health emergency of international concern in May 2022, when cases of a milder strain erupted globally. When the WHO lowered its alert level a year later, cases in Africa continued to increase.

Other Chinese companies that provide virus detection products have also been in focus. Shares of Guangzhou-based Daan Gene Co., which develops diagnostic kits, rose, along with Assure Tech Hangzhou Co., a producer of rapid test devices. The stocks outperformed the benchmark CSI 300.

Market reaction to the latest outbreak could be fleeting, Tony Ren, head of Asia healthcare research at Macquarie Capital, said.

“We see limited impact of mpox on the sector and do not expect the WHO declaration to be as significant to biopharma or the wider economy,” he said.

--With assistance from David Watkins.

(Adds Bavarian Nordic shares, context, chart)