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The past four years have been a roller coaster. moderna (mRNA 3.06%). Vaccine makers focused on mRNA rose to prominence following successful attempts to develop coronavirus vaccines.
However, the stock fell out of favor when sales of the company’s only product on the market started going in the wrong direction. Moderna’s stock price has fallen 30% over the past year, but with a total return of 230% over the past four years, there’s still a good reason to invest in the company.
MRNA Total Return Level Data by YCharts.
1. Gain market share
The coronavirus vaccine market isn’t as lucrative as it once was, but it’s not going away completely. COVID-19 has become one of the leading causes of death in the United States in 2023. Millions of people will continue to be vaccinated each year, especially those with underlying health conditions that put them at increased risk of hospitalization and death.
Therefore, Moderna needs to continue to generate sales from this market. Things look good in this regard. Numbers show Moderna is improving its position in the coronavirus vaccine space. The biotech’s U.S. market share was 48% in fall 2023, compared to 37% in the same period in 2022.
Moderna has significantly closed the gap with its biggest rival, pfizer. In 2022, Moderna’s sales were $18.4 billion, compared to Pfizer’s sales of $37.8 billion. Last year’s sales remained in Pfizer’s favor, with sales ranging from $6.7 billion to $11.2 billion. However, the difference is much smaller compared to 2022.
Things get a little more complicated in 2024. Moderna expects her $4 billion in sales this year, and that’s not just from its COVID-19 franchise. At least $3 billion should come from coronavirus-related sales. And even if you factor in the lower end of its coronavirus franchise guidance, the company will still have an edge on Pfizer’s estimated $5 billion in coronavirus vaccine revenue this year.
The coronavirus vaccine market will become less important for Moderna in the coming years, but the company’s success in gaining ground against its most notable competitors is impressive.
2. Potential catalyst
Moderna appears to be close to launching a non-coronavirus product. Last year, the company’s investigational vaccine for respiratory syncytial virus (RSV), mRNA-1345, reported positive results in a Phase 3 clinical trial. The company has submitted applications to various regulatory authorities, including the US, and expects a response from the US Food and Drug Administration (FDA) in May.
The RSV market is still new. The first vaccine received approval just last year. But RSV is especially dangerous for older adults, and Moderna estimates this market could reach $10 billion in peak sales. In 2023, it was worth just $2.5 billion.
As CEO Stephane Bancel noted during an earnings call with analysts this month, “This is very impressive considering this is the first year the RSV vaccine has been available. It had not been available for a full year and the product had not been approved in many “countries.” ” In other words, Moderna is not too late to this party. The company’s RSV vaccine could contribute significantly to sales and help reduce reliance on the coronavirus franchise.
3. Deep pipeline
Besides mRNA-1345, Moderna has several products in its late-stage pipeline that could be brought to market within the next three years. The company is conducting a Phase 3 study of a cytomegalovirus vaccine, but there are no approved options in this field yet. Moderna is also developing a combination vaccine for the new coronavirus and influenza, which is currently in late-stage research.
The biotech has partnered with another major player in the industry; Merckis testing its own cancer vaccine, mRNA-4157, in a Phase 3 trial. In a mid-stage study, combining mRNA-4157 with Merck & Co.’s famous cancer drug Keytruda reduced the risk of recurrence or death in melanoma patients.
Moderna’s late-stage pipeline has great potential, and the biotech has many programs in Phase 2 research that are expected to make significant progress in the coming years. In total, Moderna is fielding more than 20 candidates. This is another reason why Moderna looks like a great biotech stock to buy and hold, despite its recent struggles.
Prosper Junior Bakinny has no position in any stocks mentioned. The Motley Fool has a position in Merck and Pfizer and recommends Merck and Pfizer. The Motley Fool recommends Moderna. The Motley Fool has a disclosure policy.
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