The Measles Resurgence: A Shot in the Arm for Undervalued Vaccine Stocks

The World Health Organization (WHO) has issued a stark warning: global measles cases are surging to levels unseen in decades. With over 188,000 suspected cases reported through June 2025—and 88,000 confirmed—the disease is resurgent in regions like the Eastern Mediterranean (35% of global cases) and Africa (21%). In the U.S., measles infections hit a 33-year high, with Texas at the epicenter of an outbreak linked to vaccine-skeptical communities. This public health crisis is reigniting demand for the MMR (measles, mumps, rubella) vaccine, creating a rare opportunity for investors to capitalize on undervalued pharmaceutical firms positioned to profit.

The Public Health Crisis Driving Demand

The resurgence of measles is no accident. Vaccination rates have fallen sharply since the pandemic, with U.S. MMR coverage among kindergarteners dropping to 93.1% in 2022–2023 from 95.2% in 2019–2020—a decline that leaves 250,000 children annually at risk. The WHO and Pan American Health Organization (PAHO) attribute the outbreak to gaps in routine immunization and misinformation about vaccine safety. With measles requiring 95% population immunity to prevent outbreaks, the math is clear: renewed demand for MMR vaccines is inevitable.

The Investment Thesis: Undervalued Vaccine Producers

The MMR vaccine market is dominated by a handful of companies, but not all are fairly priced. Here's where to look for value:

1. Merck & Co. (MRK): The MMR Leader

Merck is the sole U.S. manufacturer of the MMR vaccine, a position it has held since acquiring Aventis Pasteur in 2004. Despite its critical role in public health, Merck's stock has underperformed the S&P 500 over the past three years, trading at just 16x forward earnings.

The company's pipeline is robust, with MMR production capacity that can scale to meet surging demand. Analysts estimate a 15% revenue boost for Merck if U.S. MMR doses increase by 10 million annually—a conservative target given the current outbreak.

2. Pfizer (PFE): Diversified Exposure to Vaccine Growth

While Pfizer's MMR contribution is minimal, its broader vaccine portfolio—including the pneumococcal and DTaP vaccines—positions it to benefit from renewed trust in immunization. Pfizer's stock trades at 18x forward earnings, below its five-year average of 22x.

3. BioNTech (BNTX): The Wildcard in mRNA Innovation

Though BioNTech's primary focus is mRNA vaccines (e.g., its partnership with Pfizer on the COVID-19 shot), its R&D prowess could lead to breakthroughs in next-gen MMR formulations. At a P/S ratio of 6.5, it's cheaper than peers like Moderna (MRNA), which trades at 12.1x.

Risks to Consider

• Regulatory Hurdles: Governments may prioritize price controls or mandates that limit profit margins.
• Production Constraints: Scaling MMR output could strain supply chains, especially if outbreaks widen.
• Misinformation: Vaccine skepticism remains a barrier, though PAHO's recent campaigns targeting at-risk communities could mitigate this.

The Bottom Line

The measles resurgence is a rare “buy the dip” moment for pharmaceutical stocks. Merck's undervalued stock and strategic position in MMR make it the top pick, while Pfizer and BioNTech offer diversification. With global health agencies urging a 95% vaccination target, investors ignoring this trend may miss a multi-year growth cycle.

Investment Action:
- Buy MRK at $125/share (5% below its 52-week high) for exposure to MMR demand.
- Consider PFE as a defensive play due to its diversified vaccine portfolio.
- Monitor BNTX for mRNA innovation but expect volatility.

The market may have overlooked these opportunities, but with measles cases hitting 30-year highs, the time to act is now.