Moderna’s Value Plummets After Pfizer’s Vaccine Warning
Moderna’s Stock Plunges by $7 Billion as Pfizer Slashes Guidance
Pharmaceutical giant Moderna has suffered a significant blow, losing several billion dollars in total value after rival Pfizer issued a warning about its COVID-19 vaccines and other products. According to a Bloomberg News analysis, Moderna’s stock plummeted by $7 billion in the past week. Pfizer’s profit outlook was slashed earlier this month, with the company expressing concerns about declining demand for COVID-19 vaccines and pills.
“COVID-19 vaccine revenue concerns should be at an all-time high right now,” says Hartaj Singh, an analyst at Oppenheimer. “A good third-quarter performance could alleviate some of these fears. And if Moderna provides strong guidance for potential revenues in 2024, it could regain its momentum.”
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The decline in Moderna’s value is not a new phenomenon. Since reaching its peak in August 2021, the company’s stock has dropped by about 83 percent, resulting in a market capitalization loss of nearly $200 billion. This decline coincided with a time when demand for COVID-19 vaccines was much higher due to vaccine mandates.
Moderna has reiterated that its guidance for mRNA COVID-19 vaccine sales remains between $6 billion and $8 billion. However, it is still too early to accurately predict U.S. vaccination rates.
Analyst Myles Minter from William Blair believes that Moderna’s U.S. COVID-19 sales will likely be at the lower end of the guidance range, based on Pfizer’s revised outlook. Moderna is scheduled to report its third-quarter earnings results in November.
Pfizer, which has also experienced a significant drop in stock value for 2023, has reduced its outlook for the anti-viral drug Paxlovid and its own mRNA vaccine by approximately $9 billion. Lower demand is the primary reason for this downward revision.
“The declining demand for the vaccine and Paxlovid indicates that we are transitioning to a post-COVID era,” says Max Nisen, an analyst at Bloomberg Intelligence. “Companies will need to adapt to this new reality beyond Pfizer.”
Recently, U.S. federal regulators approved and recommended Moderna’s and Pfizer’s latest bivalent COVID-19 booster, as well as Novavax’s vaccine, which does not utilize mRNA technology.
Current data suggests that vaccine uptake has been relatively slow this season, with only around 10 million Americans, or approximately 3 percent of the population, receiving the booster. This figure has increased from 7 million the previous week.
Despite the slow uptake, the Department of Health and Human Services (HHS) remains committed to distributing more vaccine doses and is not concerned about potential waste.
“The administration is pulling out all the stops during the fall respiratory vaccination campaign, urging the American public to stay up to date on their vaccines for their safety and the safety of their loved ones,” says an HHS spokesperson. “As a result of these efforts, around 10 million Americans have been vaccinated since the updated vaccines were authorized and recommended last month.”
Furthermore, COVID-19 hospitalizations have been decreasing over the past few weeks, along with a decline in deaths, emergency room visits, and case numbers, according to data from the U.S. Centers for Disease Control and Prevention (CDC).
The most recent data for the week ending October 14 shows a 5 percent decrease in COVID-19 hospitalizations and an 11.9 percent drop in emergency room visits, as reported by the CDC.
In a September report, the CDC predicted a “moderate COVID-19 wave” across the U.S. during the upcoming winter. However, the agency noted that the virus could peak earlier than last season due to limited summer activity.
“As with last year, the number of hospitalizations is expected to be higher than pre-pandemic levels when severe disease was primarily caused by the influenza virus and the respiratory syncytial virus,” the CDC stated.
How can Moderna diversify its product portfolio to mitigate the impact of declining COVID-19 vaccine sales and what potential therapies does the company have in its pipeline?
The pandemic and find new avenues for growth.”
The news of Moderna’s stock plunge comes as the pharmaceutical industry continues to face challenges in the wake of the COVID-19 pandemic. Vaccine hesitancy, breakthrough infections, and the emergence of new variants have all contributed to a decrease in demand for COVID-19 vaccines. Additionally, the development of alternative treatments, such as oral antiviral drugs, has shifted the focus away from vaccines.
However, it is important to note that Moderna’s mRNA technology platform extends beyond COVID-19 vaccines. The company has a robust pipeline of potential therapies for various diseases, including cancer, HIV, and rare genetic disorders. Moderna’s ability to diversify its product portfolio will be crucial in mitigating the impact of declining COVID-19 vaccine sales.
Moderna’s stock plunge also highlights the interconnectedness of the pharmaceutical industry. The performance of one company can have ripple effects on its competitors. Pfizer’s revised outlook has not only affected Moderna but has also caused a decline in its own stock value. This suggests a need for closer collaboration and coordination among pharmaceutical companies to navigate the evolving landscape of healthcare.
Despite the challenges currently faced by Moderna and the pharmaceutical industry as a whole, there is still optimism for the future. The development of COVID-19 vaccines and treatments has demonstrated the capabilities of the industry in responding to global health crises. Additionally, ongoing advancements in technology and research continue to unlock new possibilities in disease prevention and treatment.
As Moderna prepares to report its third-quarter earnings, all eyes will be on its guidance for future revenues. The company’s ability to adapt to changing market dynamics and capitalize on its pipeline of potential therapies will be crucial in regaining momentum and restoring investor confidence. In a post-COVID era, the pharmaceutical industry must continue to innovate and evolve to meet the evolving needs of patients and society as a whole.
Sources:
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/business/healthcare-pharmaceuticals/moderna-shares-slump-on-pfizer-caution-covid-19-vaccines-2023-10-23/”>https://www.reuters.com/business/healthcare-pharmaceuticals/moderna-shares-slump-on-pfizer-caution-covid-19-vaccines-2023-10-23/
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