Outside of the United States there's good reason to be concerned. Combined, Guinea, Liberia, and Sierra Leone have reported 14,383 cases of Ebola (8,892 confirmed by a lab) that have resulted in 5,165 deaths. These three countries have seen widespread transmission of the Ebola virus in spite of local and global efforts to contain it.
Even more concerning is the fact that the Ebola virus can lie dormant in a person for up to 21 days without showing symptoms. This extended incubation period is what makes containment of the disease so difficult, especially in regions of the world where access to health care facilities and coordinated care -- such as many West African countries -- are hard to come by.
I certainly don't want to make light of this disease, as 5,177 deaths (this includes all affected countries plus West Africa according to the World Health Organization) is 5,177 too many. But within the United States there's a far more pressing concern that Americans should be paying attention to: the flu.
Worry about this infectious disease instead!
Together, influenza and pneumonia are the eighth leading cause of death in the U.S. based on data from the CDC in 2011. The 53,826 people that unfortunately died from these infectious diseases in 2011 completely dwarf the threat that Ebola poses to U.S. citizens today. This doesn't mean biopharmaceutical companies shouldn't continue to invest in an Ebola vaccine, as it does have clear pandemic potential, but in America influenza is a far bigger concern. More importantly, October through December marks the kickoff of flu season each year.
One reason the flu is such an obvious concern has to do with Americans' notoriously bad track record of getting flu shots. Data from the CDC between 2009 and 2011 shows that only about 40% of adults aged 18 and older get a flu shot each year, further increasing the chance of flu-related hospitalizations.
Admittedly, it's not hard to understand why many Americans don't get flu shots. A flu shot doesn't cure or prevent the flu necessarily. Instead, it's designed to enhance your immune systems' ability to fight the infection and reduce your chances of winding up in the hospital. The flu is most often fatal in the elderly and children, so encouraging as many healthy young adults to get the shot as possible in order to ensure they don't wind up in the hospitals leaves more beds available to treat the elderly and children, who have weaker immune systems.
A flu shot is also something of a guessing game for researchers. No one knows for sure which strains will dominate in the upcoming year, so pharmaceutical companies have to make educated guesses as to what strains their vaccine will help guard against months before flu season begins in order to have enough available by the time flu season kicks off. Many times pharmaceutical companies have been spot on, but this won't always be the case.
A big opportunity for Americans and investors
Despite a flu shot offering no guarantees of success, statistics have unequivocally shown that there is a benefit for the individual and the healthcare system as a whole if people get flu shots. The 2012-2013 update from the CDC demonstrated a combined age group vaccine effectiveness of 56%. While clearly not protecting everyone, a flu shot significantly reduces a person's chances of winding up in the hospital with a severe form of the flu.
Influenza vaccines also represent a huge opportunity for pharmaceutical companies should more Americans take the plunge and get their annual vaccine. It's possible we could actually see a surge in vaccinations this flu season thanks to the Affordable Care Act, known better as Obamacare. Obamacare has dramatically reduced the number of uninsured to just 13.4% according to Gallup, and many health insurance plans cover flu shots free of charge. Thus more people covered should theoretically lead to more people getting free flu shots. We may know in a few months if this does indeed come to fruition.
Pharmaceutical companies currently manufacture two types of vaccines, trivalent and quadrivalent vaccines. As the name implies, trivalent vaccines protect against two influenza A-strain viruses and one B-strain virus, whereas quadrivalent vaccines, which came out within the past couple of years, protect against two type A and two type B influenza strains. The Food and Drug Administration doesn't quantify one type of vaccine as better than the other statistically, but a majority of pharmaceutical companies are now predominantly providing quadrivalent versions of their vaccines.
The major flu vaccine players are CSL (NASDAQOTH: CSLLY ), which recently agreed to acquire Novartis' (NYSE: NVS) influenza business for $275 million, GlaxoSmithKline (NYSE: GSK), AstraZeneca (NYSE:AZN), and Sanofi(NYSE: SNY ) .
AstraZeneca's vaccine, FluMist, is perhaps the most unique because it's the only one that doesn't come with a needle. Designed as a nasal spray, FluMist provides the perfect solution for those of us (like myself) who are somewhat needle-phobic. The trade-off, of course, is that FluMist's convenience is going to cost more than a traditional shot. You might think FluMist would be a good seller based on its "lack of pain" factor, but it's traditionally underperformed other, needle-based, vaccines.
The remaining vaccines are GlaxoSmithKline's Fluarix and FluLavel, CSL's Fluvirin, and Sanofi's Fluzone. Though GlaxoSmithKline was the first company to originally introduce the quadrivalent vaccine, it's Sanofi's Fluzone that's been the runaway sales leader in flu vaccines for the past couple of years.
The reason is that Fluzone comes with a number of advantages over its peers, including six different dosing options and the ability to be administered in patients as young as six months old. Sanofi even has an administration device for needle-phobes like myself that's 90% shorter than traditional needles. Therefore, if the ACA does create a flu vaccine boost this year, Sanofi could be an instant beneficiary.
Unlike quarterly reports which only come out every 13 weeks, the CDC releases flu case updates (which you can see above) on a weekly basis, so you can keep abreast of whether this year winds up being a normal, above-average, or below-average year for flu cases. Regardless of whether you're an investor or not, this is really something that Americans should be keeping their eyes on.
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