The Zika virus, at first glance, does not seem to have the potential to become the alarming international health crisis that it has become today. Prior to 2015, outbreaks of the virus occurred mainly in Africa, Southeast Asia, and the Pacific Islands. However, in May 2015, an alert was sounded by the Pan American Health Organization regarding confirmed infections in Brazil. There are currently outbreaks occurring in numerous countries, including the United States (contracted sexually) and Spain. The World Health Organization has predicted that 3,000,000 to 4,000,000 more individuals are likely to become infected. The spread of Zika is not as much due to increasing globalization and travel as one would suspect. Instead, mosquitoes thrive in warm, humid environments, which are becoming more common worldwide due to climate change.Zika is spread by the mosquito Aedes aegypti, but can also be acquired through sexual contact. Up to 80% of those infected with the virus will not experience any indication that that have contracted it. Those that do have symptoms will present with fever, rash, joint pain, and red eyes. But a connection (though still not scientifically proven) has recently been established between pregnant mothers infected with the Zika virus and microcephaly, a condition that causes infants to be born with abnormally small heads and resultant brain damage. Zika has also been linked to Guillain-Barré syndrome, an autoimmune disease that targets the nervous system. Brazil's strict anti-abortion laws prevent the termination of a pregnancy even in the case of a Zika infection, which is partially responsible for the uptick in Zika-complicated births. Although these laws may be subject to amendments, there are many religious barriers in the way of change; as of now, Brazil and El Salvadors are asking their citizens to postpone pregnancies for three years if possible. There is still no vaccine or cure for the virus.
The outbreaks are economically devastating for Brazil, which is hosting the 2016 Olympic Games in Rio de Janeiro. International visitors aside, many athletes may not wish to jeopardize their health by attending the games and risking exposure to the virus. Despite Brazil's insistence that the risks associated with Zika are limited to pregnant women (who have been advised to avoid attending the event), tourism is already suffering in the area (Royal Caribbean Cruises Ltd. (NYSE: RCL)), for example, experienced a 4.4% drop in its stock this week alone). Many of the affected tourism locations are commonly referred to as "babymoons"-areas where pregnant mothers go on vacation before giving birth.
However, some companies, largely in healthcare and vaccine engineering, do stand to profit. Inovio Pharmaceuticals, Inc. (NASDAQ: INO) and its collaborator GeneOne Life Science Inc. (KRX: 011000) had their shares gained 32% and 46% this week, respectively. The former is in the process of developing a DNA-based vaccine for both preventing and treating the Zika virus. GeneOne is also involved in the development of a Zika vaccine, along with vaccines for Ebola and MERS. Shares of Cerus Corporation (NASDAQ: CERS), which makes Intercept Blood System (the system works to prevent transfusion-transmitted infections) have risen 4.6%; Intrexon Corporation (NYSE: XON), whose Oxitec unit manufactures genetically modified male mosquitoes (whose subsequent offspring are programmed to die young) has seen a 5.5% increase. Until the spread of the virus is contained, tourism can be expected to suffer, whereas healthcare industries will continue to benefit due to increasing need for their services.