Moderna’s Future: A New Chapter Unfolds
As the biotech giant Moderna (NASDAQ: MRNA) navigates the decline of its coronavirus vaccine sales, investors are left wondering what the future holds. By 2028, Moderna will have entered a new phase, potentially operating more like a traditional pharmaceutical company. The question is, will this new chapter be more promising than the last?
Setting Realistic Expectations
It’s essential to temper expectations: Moderna won’t revisit its all-time highs for revenue or earnings in the next three years. The likelihood of another windfall like its coronavirus vaccine is slim to none. However, there’s still a compelling investment thesis for this stock, provided investors are willing to be patient.
Management’s Ambitious Plans
Over the next three years, Moderna plans to launch 10 new products and reduce its annual research and development expenses by $1.1 billion. With trailing-12-month revenue at $5 billion and operating losses of $2.7 billion, the pressure is on to deliver in-demand medicines while financial resources are becoming more constrained.
Blockbuster Potential
Three products hold significant earning potential: the combination shot for influenza and COVID, the influenza vaccine, and the next-generation COVID vaccine. Each of these programs could become a blockbuster drug, generating over $1 billion in annual sales revenue. Moreover, government grants, such as the $590 million awarded by the Department of Health and Human Services, could provide a significant boost to the company’s pipeline programs.
Oncology Pipeline Holds Promise
Moderna’s seven oncology drugs in mid-to-late-stage clinical trials, particularly its individualized neoantigen therapies (INTs), are noteworthy for their innovative mechanism of action. INTs use a patient’s tumor cells to train their immune system to fight cancer more effectively. While these medicines may not immediately generate significant revenue, they could be a major advancement in cancer treatment.
A Long-Term Investment
In summary, Moderna is poised for its next major growth phase by 2028, but investors should be prepared to hold the stock for at least five years or more. While there’s no pressing deadline to buy the stock today, it’s essential to be aware that clinical program failures could negatively impact the stock’s price. Nevertheless, Moderna’s advanced therapeutic vaccines hold significant potential, and the company is on track to prove its worth in the biopharma landscape.
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