Investors have plowed $151 billion into coronavirus bonds in a rush to stem pandemic damage

• Investors pushed $151.5 billion into so-called pandemic bonds from February to May as firms raised debt linked to coronavirus relief efforts, The Wall Street Journal reported Wednesday.
• Pharmaceutical giant Pfizer raised $1.25 billion in March, while Bank of America issued $1 billion in bonds set to raise cash for healthcare lending.
• More than 200 companies in China collectively raised more than $74 billion in May with pandemic-related debt sales, according to The Journal.
• The assets are still mired in some debate, as coronavirus bonds aren't tied to specific criteria and payouts aren't closely tracked.
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Companies, central banks, and governments sold $151.5 billion worth of so-called pandemic bonds from February to May as investors rushed to coronavirus-relief assets, The Wall Street Journal reported Wednesday.

Such bond sales eclipsed those of sustainability-focused debt in March and peaked at $66.5 billion worth of sales in April, according to BNP Paribas research viewed by The Journal. Issuance dipped in May to $43.6 billion but still overshadowed firms' sales of socially responsible bonds.

Coronavirus bonds use proceeds to fund efforts connected to pandemic aid, whether through economic stimulus, treatment trials, or hospital funding. The assets aren't based on a certain standard, leaving their definition somewhat hazy despite surging popularity.

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Pharmaceutical titan Pfizer took in $1.25 billion in March by selling 10-year notes, classifying the assets as sustainability bonds and saying it mulled the sale before the pandemic struck. Yet BNP Paribas deemed the vehicles coronavirus bonds, according to The Journal, as Pfizer is working on its own COVID-19 vaccine.

Bank of America raised $1 billion with the issuance of bonds used to "support the fight against the COVID-19 pandemic," according to The Journal, earmarking the funds for lending to healthcare firms.

The assets are popular outside the US as well. More than 200 Chinese companies collectively took in more than $74 billion in May through more than 700 coronavirus bonds, The Journal reported, citing data from Wind Info. Yet some of the funds raised are set to be used for debt refinancing and bankruptcy avoidance, further blurring the line between a regular bond sale and a pandemic-related issuance.

Murkiness surrounding pandemic bonds' criteria and payouts has already drawn criticism from industry experts. The World Bank issued its own pandemic bonds in 2017 to combat the Ebola virus. Investors enjoyed lofty interest rates but risked losing their principal investment should a pandemic meet certain criteria and divert funds to relief efforts.

Hundreds of millions of dollars remained in the vehicles up until the coronavirus emerged. Yet complex trigger rules and a delayed response sullied the assets' effectiveness, Olga Jonas, senior fellow at the Harvard School of Public Health and former World Bank economist, told Business Insider in February.

"The advertising was that there would be early, rapid, predictable, transparent financing available for outbreaks so that they don't become pandemics," Jonas said. "In order for that to happen you have to have early triggers. The triggers in the design are very late."

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