Moderna Inc. said Thursday that it was making progress on getting new vaccines approved, but it also said it would cut back on its R&D spending and its pipeline in order to get out of the slump caused by a COVID vaccine market that isn’t growing.
For the years 2025 through 2028, the biotech company said it would spend 20% less on research and development, or $16 billion. Moderna MRNA 0.29% said Thursday that it wants to get 10 approvals by 2027, which is less than what it said a year ago when it said it wanted to get up to 15 drugs on the market within five years. The company is also getting rid of five drug prospects. These include test vaccines for seasonal coronaviruses and RSV in babies.
Additionally, the company said that its flu and respiratory syncytial virus vaccines had positive late-stage trial results. It also said that it hopes to apply for three vaccine approvals this year. Some of these are a next-generation COVID shot, a flu and COVID vaccine that works together, and an RSV vaccine label that includes high-risk people younger than 60 years old.
Moderna’s Chief Financial Officer, Jamey Mock, told MarketWatch, “We’ve had incredible clinical success.” He pointed to two approved respiratory products, strong late-stage clinical trial data, and a number of assets that are ready to be sent to regulators. He said, “We’re just trying to really focus the portfolio” on the most important decisions for the next few years.
The news came out right before Moderna’s research-and-development day on Thursday. The company is trying to get back on track after a slow start for its RSV shot and falling demand for COVID vaccines. Early in August, Moderna’s shares dropped the most in a single day ever after the company predicted sales for the whole year of 2024 would be between $3 billion and $3.5 billion, down from $4 billion.
Moderna said Thursday that sales may not get any better next year: The business said it thought sales would be between $2.5 billion and $3.5 billion in 2025. Moderna said it wants to break even in 2028 based on running cash costs, which don’t include costs for stock-based compensation, depreciation, and amortisation.
Moderna’s second product was cleared by the Food and Drug Administration in May. It was the RSV vaccine mResvia, which is meant for adults aged 60 and up. But firms like Pfizer Inc. PFE -0.27% and GSK PLC GSK -0.75% are making it hard for that product to stand out. Another problem is that in June, the Centres for Disease Control and Prevention changed their minds about who should get the RSV vaccine. This made it less likely that more people would get the shot.
That’s because the market for COVID vaccines has dropped sharply and the market for RSV vaccines is just starting to grow, Mock said. Mock said, “It remains to be seen whether the company will be better able to compete in the RSV market next year.” Overall, we’re happy with how well the product is doing in the market.
Moderna can also get more people to buy its RSV shot. On Thursday, the company announced positive late-stage trial results for the vaccine in high-risk adults under 60 years old. The company said the shot met its main immune-response goals in the trial and that the dose already approved for older adults was well-tolerated.
Because Moderna wants to focus on making the most important goods first, it is no longer trying to get its experimental flu vaccine, mRNA-1010, approved more quickly. Instead, it will put its resources into an application for approval of the COVID and flu vaccine together.
Moderna said it will soon start a phase 3 study of its experimental vaccine against norovirus. Norovirus is a very contagious virus that makes people throw up and have diarrhoea.
Some experts thought Moderna might try to get faster approval for its experimental personalised cancer vaccine, which is a joint project with Merck & Co. Inc. MRK -0.54%, but the company said Thursday that they didn’t think that would happen. Moderna said in a press release that the “initial feedback from FDA has not been supportive of accelerated approval based on the current data.” The company also said that it would continue to focus on running a phase 3 study.
The S&P 500 SPX 1.07% has gone up 16% so far this year, while Moderna’s stock is down 20%.
