Will J&J ETFs Suffer on Latest COVID-19 Vaccine Updates?
The coronavirus outbreak continues to worsen as infection cases are rising globally. Recently, Europe crossed the grim milestone of one million coronavirus-related deaths, according to the World Health Organization (WHO). Brazil and China are also facing a severe rise in the daily number of coronavirus cases.
Heightening worries amid this situation, the latest update regarding Johnson & Johnson’s JNJ coronavirus vaccine is a little depressing. Going by a CNN report, the Centers for Disease Control and Prevention and the FDA recommended an immediate pause on the use of Johnson & Johnson's COVID- 19 vaccine over reports of a "rare and severe type of blood clot" in six out of millions vaccinated.
Notably, the six reported cases fall under the umbrella of more than 6.8 million doses of the Johnson & Johnson vaccine provided in the United States. Going on, the report highlighted that six women between the ages of 18 and 48 saw unusual clots with symptoms appearing six to 13 days after vaccination.
J&J’s single-shot COVID-19 vaccine is presently approved for emergency use in the United States and was granted Conditional Marketing Authorization (CMA) by the European Commission last month. However, the vaccine has not yet been rolled out in European countries.
Moving on, recently the European Medicines Agency (“EMA”) safety committee, Pharmacovigilance Risk Assessment Committee (“PRAC”), started a review to evaluate reports of blood clots in some people who had taken the J&J one-shot COVID-19 vaccine.
Markedly, the EMA’s report mentioned that four cases of rare clots accompanied by low blood platelets have been identified after vaccination with J&J’s vaccine. One of the cases was fatal. Though such blood clot reports increase safety issues, a causal link between J&J’s vaccine and these rare events has not been established. PRAC is analyzing the cases and will give its decision of whether regulatory action is required. J&J is the second company whose COVID-19 vaccine is being studied for rare blood clot events.
JNJ ETFs That Can Suffer
The worsening coronavirus crisis has increased desperation among investors over the accelerated distribution of the coronavirus vaccine to develop herd immunity. In such a scenario, any progress or failure in coronavirus vaccine is going to affect investors’ opinions. Thus, let’s take a look at ETFs that can be affected from the recent development:
iShares U.S. Pharmaceuticals ETF IHE
This ETF provides exposure to 45 companies that manufacture prescription or over-the-counter drugs or vaccines by tracking the Dow Jones U.S. Select Pharmaceuticals Index. Of these, Johnson & Johnson takes the top spot, accounting for about 22.6% share. The product has charges 42 bps in fees (read: ETFs to Shine on Pfizer's Impressive COVID-19 Vaccine Update).
The Health Care Select Sector SPDR Fund XLV
The most-popular healthcare ETF, XLV, follows the Health Care Select Sector Index. Expense ratio comes in at 0.12%. In total, the fund holds 63 securities in its basket, with JNJ taking the top spot, accounting for 9.5% of the assets (read: 4 Sector ETFs to Watch for Gains in Q2).
iShares Evolved U.S. Innovative Healthcare ETF IEIH
This actively-managed ETF employs data science techniques to identify companies with exposure to the innovative healthcare sector. Holding 251 stocks in its basket, JNJ is the top firm with a 9.8% allocation. The product charges 18 bps in annual fees (read: ETFs to Tap Amgen's Drive for Cancer Deal).
iShares U.S. Healthcare ETF IYH
This fund offers exposure to 126 securities by tracking the Dow Jones U.S. Health Care Index. Here again, Johnson & Johnson dominates the fund’s returns with 8.5% of the total assets. The product charges 43 bps in annual fees.
First Trust Nasdaq Pharmaceuticals ETF FTXH
This ETF tracks the Nasdaq US Smart Pharmaceuticals Index and holds 30 stocks in its basket. Of these, Johnson & Johnson occupies the third position with an 8% allocation. It charges 60 bps in annual fees.
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Health Care Select Sector SPDR ETF (XLV): ETF Research Reports
iShares U.S. Healthcare ETF (IYH): ETF Research Reports
iShares U.S. Pharmaceuticals ETF (IHE): ETF Research Reports
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