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What does ‘defeating’ the virus look like?

Monday’s strong rally was based on rumours that maybe an effective vaccine would soon appear to release the world from virus restrictions. Is this overly optimistic?

Monday’s strong rally was based on rumours that maybe an effective vaccine would soon appear to release the world from virus restrictions. Is this over optimistic?

by
John Redwood

in Features

19.05.2020

The medical fight against Covid-19 has come to dominate government policies and is the main determinant of how economies and companies will fare. I am not a medical doctor, and Charles Stanley certainly does not offer medical advice. Given the importance ascribed by all governments to defeating the virus as a precondition for restoring more normal economic life, we do need to tiptoe into medical territory to ask what winning against the pandemic looks like.

As we have often said, the policies followed to stop or arrest the spread of the virus are very damaging to all those business activities that thrive on social contact. Full lockdown means a large hit to demand as well as to supply. Continued strict social distancing after the end of lockdown means many businesses will be operating well-below previous levels of output. Monday’s strong rally was based on rumours that maybe an effective vaccine would soon appear to release the world from virus restrictions.

The epidemiologists and other scientists and medics who advise governments have always had in mind the desirability of producing a safe and effective vaccine. If they could do this, and roll it out on a huge scale worldwide, they would be happy then to recommend the removal of the controls upon us.

Accelerated timetable

Usually researching, testing and then producing a vaccine takes many years. This time huge sums of money and large numbers of the best medical minds are being poured into an attempt to speed all this up. There is collaborative competition, with groups in the main research cities working with pharmaceutical companies to be the first to have a successful product, whilst undertaking appropriate sharing of information about the disease and its responses through the WHO and other fora.

There is likely to be shared production and exploitation of any breakthrough to be fair to the world and to provide the scale needed. There is controlled optimism in the UK about the Oxford approach where they are already testing a vaccine, and in the US where Donald Trump is an enthusiast for US science.

It is difficult placing odds on this. Many specialists in the field caution against expecting an early breakthrough – and point out how many infectious diseases have defeated the best minds for many years. Clearly, were such a breakthrough to occur, the companies contracted to make it will do well out of the huge volumes required, and markets generally would experience a re-rating at the thought of travel, tourism, hospitality and the rest being able to return to the old normal. We think it unlikely there will be an early roll-out of a global vaccine that can protect most people from the disease, given the scientific, medical and industrial challenges of such a course.

Medical ingenuity

There is also the possibility that doctors will get better at understanding and treating the disease. If fewer people who caught it died as a result, it would be possible to revisit the measures taken to limit its spread with a view to making it easier for more social contact. Frequent hand washing and isolation of people with the illness might continue, but one-metre to two-metre separation might cease in these conditions.

There are various strands of medical opinion over what are the best ways to treat the infection. There has been recent discussion about the way in some severe cases patients experience blood clotting in the lungs and other organs, leading doctors to propose using medicines for blood thinning and clot busting that already have licences. There is the possibility that some existing anti-inflammatory drugs and some malaria treatments might have some therapeutic use against the virus. They are being trialled on patients, as they already have regulatory approval for other uses.

On Monday, Mr Trump created a media storm by favourably mentioning one anti-malarial which many doctors deny can help. There is the possibility that a pharmaceutical company will come up with a new drug or a cocktail of drugs that is effective at preventing the virus from killing the patient, or can control a patient's immune system responses which some say get out of control in severe cases of the disease.

The fact that people with darker skin seem to be more susceptible to the life-threatening form of the disease in temperate climates has led some to argue that a Vitamin D deficiency makes people more prone to the illness, affecting immune systems. A lack of sunshine generating Vitamin D, or a diet low in foods that offer sources of Vitamin D might be part of the problem. If so, it would be relatively easy to remedy. There is also the issue of the links between deaths from the virus and diabetes, obesity and being overweight – which some are exploring to see if that points in the direction of any particular treatments.

The medical and scientific responses to the virus are fast moving and subject to much argument about the disease and how to tackle it. It is safest to assume there will be no breakthrough to a successful worldwide vaccine solution any time soon, and limited progress with preferred treatments for taming the disease. Were that to change, it would be bullish, with particularly good implications for the drug companies that have the right products.

Meanwhile, governments will persevere with test, trace and isolate as their best way of trying to combine more forms of business activity with reduced social contact and swift responses to more outbreaks of the infection. It remains prudent to concentrate share investing in those sectors and companies that can trade well in conditions where social distancing remains in place.

Nothing on this website should be construed as personal advice based on your circumstances. No news or research item is a personal recommendation to deal.

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