Today a post about my worst investment (so far): CureVac.
What is/makes CureVac?
Founded in 2000, CureVac is the first company in the world to research mRNA technology for the treatment of disease and the production of vaccines [1]. Thus, even after the onset of the Covid-19 pandemic, CureVac was one of the first companies to announce the development of an mRNA-based vaccine against Covid-19.
Why did I invest in CureVac about a year ago?
The investment had several reasons for me. First, I became aware of CureVac due to the hype, which was generated, among other things, by the fact that Donald Trump was interested in exclusive rights to CureVac's vaccine and offered $1 billion for it [2].
Subsequently, the German government also invested 300 million euros [3] to win CureVac over.
Due to the hype generated, the share price naturally moved accordingly. It went from around $50-60 to highs of around $133. Somewhere in between (around $100) the famous FOMO (Fear of missing out) kicked in for me. I had done enough research to know that the Corona vaccine would be needed over the next months and years and assumed that CureVac would become one of the big players in this space.
An additional buying argument came out of emotional reasons (not good): I myself come from the Stuttgart region, so CureVac's headquarters in Tübingen are not far away. I liked the idea of owning shares in an AG from the surrounding area that potentially saves the world (to put it quite exaggeratedly).
Why did it all go to shit?
Unlike other companies that have developed or are developing mRNA-based vaccines against Covid-19, CureVac decided to use unmodified mRNA whereas other companies (Biontech, Moderna) relied on modified mRNA [4].
I don't want to go into the exact differences (you can read about them quite well in [4]), since I am not a specialist myself, but the numbers speak for themselves:
Biontech: 95% efficacy rate [5].
Moderna: 85% efficacy rate [5]
CureVac: 47% efficacy rate [5]
The data are certainly different in today's world after the appearance of many different variants, but one can clearly see the difference between the CureVac vaccine and that of other mRNA-based vaccines.
What learning do I draw from this?
Unfortunately, hype around a stock, fear of missing out and emotional reasons are all not good investment advisors or buying arguments and should be excluded from investments as much as possible.
In addition, the pharmaceutical and biotechnology industry is in many cases very speculative and often a single approval of a drug or vaccine can decide the ups or downs on the stock market.
This was exactly the case with CureVac, as the entire narrative surrounding the company was based on the Covid-19 vaccine and its approval.
Will I make such a mistake again in the future?
Here I would very much like to answer no, but I am a very honest person and therefore can only answer in the affirmative.
Of course, I try to keep the upper hand against hype, FOMO or other emotions when investing, but man is simply an emotional being and the effects that such phenomena have on us, one will probably never be able to completely hide (at least that applies to me).
Is there hope for CureVac?
In any case, CureVac continues to work briskly on their second generation vaccine, which will probably also be adapted for the currently prevailing omicron variant (currently in preclinical development).
Another long-term goal (as with Biontech) is to be able to cure cancer with the help of mRNA technology [6].
Tesla Automation (a subsidiary of Tesla - formerly Grohmann Engineering and then Tesla Grohmann Automation) is also working on an mRNA printer called The RNA Printer®, which could be found in many hospitals etc. in the future and produce the appropriate vaccine at the push of a button in order to be able to react to disease outbreaks [7].
Whether all this justifies the current valuation or an even higher valuation in the future is more than questionable.
In any case, I will keep my shares (current status: approx. -82%). The hope to get out of it again with profit is meanwhile very small (understandably). However, the shares are now more of a reminder in my portfolio - a kind of daily reminder that you don't have to take every hype and that it's better to keep your hands off some things.
In this sense, I wish everyone a nice weekend and stay healthy!
References:
[1] https://www.curevac.com/ueber-uns/
[2] https://www.sueddeutsche.de/wirtschaft/curevac-hopp-coronavirus-1.4847048
[3] https://www.curevac.com/2020/06/15/bundesregierung-beteiligt-sich-mit-300-millionen-euro-an-curevac/
[4] https://www.spektrum.de/news/corona-impfstoffe-warum-curevac-anders-ist/1882984
[6] https://www.swr.de/wissen/mrna-medikamente-der-zukunft-100.html
[7] https://www.curevac.com/technologie/produktion/
