Geoffrey Smith 

Investing.com — The stock market loved it, but euphoria at Merck’s (NYSE:) announcement last week that it that can be taken in pill form is probably premature.

The news is not to be taken lightly, however. The interim results of a curtailed phase 3 trial – typically the last in a series required for new drugs – suggest very strongly that the drug is effective in preventing serious illness and death and is free from significant side-effects.

If that is confirmed by regulators, then the world will have its first effective Covid treatment in tablet form – easier by orders of magnitude to mass-manufacture, distribute and administer than vaccines.

It is not likely that it will solve the main problem with bringing Covid-19 under management: low vaccination rates in the poorer nations. Fewer than 20% of India’s 1.38 billion population are fully vaccinated. Of Africa’s seven most populous countries, accounting for over 730 million people, only South Africa has a vaccination rate over 6%. Molnupiravir won’t stop this disease spreading or mutating among them.

Antiviral pills are in the first place a treatment, and not a preventative. The drug is not intended to replace mass-vaccination.  Merck’s press release suggested that the drug does have some prophylactic quality, but the clinical trial has only focused on treating people who already have Covid.

As such, the drug is likely to have a greater impact – at least initially – in the rich world, where it appears excellently suited as a second line of defense in combating ‘breakthrough’ infections among the vaccinated, and as a safety net to the substantial minorities who have refused or been unable to take vaccines.

It is not clear whether state-backed insurance companies will be willing to cover a $700 course for patients who refuse to receive a $20 vaccine. This makes it more likely that people are inclined to agree to the best defense against Covid.

There are many more urgent questions you need to address before that stage can be reached. Its safety is what’s most urgent. 

Merck excluded pregnant women from its test and insisted on patients abstaining from sex during the treatment, suggesting that it has not ruled out the risk that the drug’s technology, which deliberately fouls up the way the virus replicates itself, may have unintended consequences.  These things, obviously, are not within the reach of a 29 day trial.

Merck is likely to prosper if the drug gets approved. Already, it has an $1.2billion preliminary sales contract with U.S. and more countries are in line to place orders. Australia, for example, ordered 300,000.

It is difficult to estimate how much the drug will make in the poorer nations, as there are not many details about the pricing of the initial agreement it has with Indian generic drug producers. It is also unlikely that it will have this field all to itself long. Roche Pfizer (NYSE:) Both have antiviral treatments in development.  

Naturally, all of this is beneficial for health systems, consumers, and everyone who desires a quick return to pre–Covid conditions. Mass vaccination is the true panademic-changer. It seems likely that the benefits of providing this vaccine will be greater than the Merck shareholder rewards.