The mass exodus of key figures at the Centers of Disease Control and Prevention is a “red flag” for vaccine drug makers.
The White House removed Director Susan Monarez. Jim O’Neil will replace her. O’Neil has an investor background as the CEO of the Thiel Foundation (2009-2012). He was the managing director of Mithril Capital Management for seven years, from 2012 to 2019. His lack of a public health work background is troubling. Companies like Pfizer (PFE) and Moderna (MRNA) need someone who can interpret statistics in clinical and public health settings.
Investors should expect that support for vaccines may slow down. At worst, the CDC might cut funding for vaccine research. Markets are already anticipating the worst for mRNA-based vaccines. Moderna's stock lost around 40% in 2025.
On August 27, the FDA authorized an updated COVID-19 vaccine. However, it restricted the authorization to people who are 65 and older. People prone to severe illness from COVID and those at risk of severe disease due to one or more medical conditions are authorized.
Novavax (NVAX) and BioNTech (BNTX) are vaccine developers that investors should be wary of.
Your Takeaway
Expect the drug sector to continue underperforming. AbbVie (ABBV) and Gilead (GILD) are exceptions. However, they are largely unaffected by personnel changes at the CDC.
