Pharma Firms Expect Benefit From Swine Flu

Drug makers that produce flu treatments are expected to see positive movements in trading on Monday off a potential boost in swine-flu related revenue.

Gilead Sciences(GILD), GlaxoSmithKline(GSK) and Novavax(NVAX) are among the names that are expected to be in the green.

The U.S. government has already stepped up orders for Tamiflu and Relenza, known treatments of the disease.

Tamiflu, an oral treatment, was developed by Gilead. The company receives royalties from the drug's maker, Switzerland-based Roche. Tamiflu is sold in Japan through a company mostly owned by Roche, while in India, Cipla makes a generic version.

Relenza, an inhaled drug, is made by GlaxoSmithKline. Gilead was up 3% to $47.31 in morning trading, while GlaxoSmithKline jumped 5% to $30.84.

Bio Defense companies like Novavax and BioCryst Pharmaceuticals(BCRX) could also see a benefit from the outbreak, as their technologies help to quickly make the vaccine. Shares of both companies jumped on Friday when Mexico reported that the flu killed 60 people.

In a moderating note, Jim Cramer warned today that while the spread of swine flu could mean more revenue, the initial impact should be fairly small. Thus, if the disease is controlled quickly, don't expect to see much upside.

Aside from drugmakers, there could also be some upside potential for companies like Johnson & Johnson(JNJ), which owns hand sanitizer maker Purell, as well as 3M(MMM), which makes protective face masks.

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