Jim Cramer, on CNBC, exclaimed that Zoetis Inc (NYSE:ZTS) might bring to the market a new vaccine to save piglets from the deadly porcine epidemic diarrhea virus (PEDv), which has killed more than 10% of American swine population, roughly 5 million pigs. U.S. Department of Agriculture (USDA) granted the company a conditional license that will allow it to sell the vaccine starting with the current month.
As we might conclude, the price for pork and bacon is going to decline if the product proves to be effective enough to overcome the epidemic.
“[...] Remember, 5 million pigs have died, the price of pigs has doubled, bacon’s up 10%. It’s been considered to be in the basket of the consumer. The worst part, now let’s think about it, cotton has now come down gigantically, corn has come down […] Zoetis’s vaccine will cause pork prices to plummet [...],” said Jim Cramer.
In fact, this is a widely held opinion, upon which many already base their expectations, although Zoetis Inc (NYSE:ZTS) is not the first company to announce the release of a PEDv vaccine. In June, Harrisvaccines attained a similar conditional approval, but there is little information regarding its progress.
Many countries are already skeptical towards pork imports from U.S. since evidence about PEDv has been spread. Zoetis Inc (NYSE:ZTS) will have the chance of positively impacting the market with its new product. The company’s planning to explore other regions around the globe that might be affected by the virus, thus in need of help. Currently, the license allows two-dose inactivated vaccine to be administered to healthy pregnant sows, but laboratory researches and in-field tests are still pursued by Zoetis Inc (NYSE:ZTS) into improving its product.
There is little or no information regarding the success attained so far in terms of mortality reduction among piglets and the company hasn’t revealed the price for its drug yet. We’re about to find it out anyways, either going to the drug store or waiting further posts regarding the issue. Hopefully, no unpleasant surprises will be encountered till then.