Modern The company on Thursday reported second-quarter revenue that beat expectations but cut its full-year revenue forecast, saying lower sales were expected in Europe, there was a “competitive environment” for respiratory vaccines within the U.S. and international sales could also be delayed until 2025.
The biotechnology company now expects product sales of between $3 billion and $3.5 billion for 2024, down from its previous forecast of $4 billion.
The company's shares closed greater than 20% lower on Thursday.
The company has begun shipping its respiratory syncytial virus vaccine, called mRESVIA, within the U.S. after it was approved for older adults in May. It is Moderna's second commercially available product after the Covid vaccine, demand for which has fallen because the world emerges from the pandemic and relies less on protective shots and coverings.
Stephane Bancel, CEO of Moderna, told CNBC that there was “greater intensity of competition” in each RSV and Covid vaccines. He noted that mRESVIA is the third RSV vaccine to hit the market, following the Pfizer And GSKthe latter dominating the market last yr.
He added that “we have had quite intensive discussions with governments across Europe” to secure supplies of Moderna’s Covid vaccines.
But “some countries told us just last week that due to very tight budgets, they simply did not have the capacity to buy more vaccine than they needed because they already had another contract,” Bancel said.
He refers back to the European Union massive renegotiated supply contract for Covid vaccine with Pfizer and his German partner BioNTechHe also referred to the continued war in Ukraine, which is putting a strain on state budgets.
Nevertheless, Moderna expects to return to sales growth in 2025 and break even by 2026 with the launch of latest products, Bancel said.
Here's what Moderna reported for the second quarter, in comparison with Wall Street expectations, based on an LSEG analyst survey:
- Loss per share: $3.33 versus an expected lack of $3.39
- Revenue: $241 million versus expected $132 million
The company reported second-quarter revenue of $241 million, with product sales of its Covid vaccine falling 37 percent in comparison with the identical period last yr. Moderna reported revenue of $344 million in the identical period last yr.
The company said the sales decline was partly attributable to the expected transition to a seasonal Covid vaccine market, where patients typically receive their shots in the autumn and winter. However, Bancel said Moderna had a “good spring season” within the U.S. for seniors who’re really helpful to receive an extra dose of the newest round of Covid vaccinations.
Moderna reported a net lack of $1.28 billion, or $3.33 per share, within the second quarter. In the identical period last yr, the online loss was $1.38 billion, or $3.62 per share.
Bancel said the corporate's losses were partly attributable to progress in cost-cutting and that Wall Street had recorded smaller losses than expected.
Moderna “made a little more revenue than expected, but also saved a lot more costs than Wall Street expected,” he said. “So I'm really pleased with the progress we're making on both fronts.”
Selling expenses were $115 million, down 84 percent from the identical period last yr. This included $14 million in write-offs for unused doses of the Covid vaccine and $55 million in costs related to the corporate's efforts to scale back its manufacturing capability.
Research and development expenses increased 6% to $1.2 billion within the second quarter in comparison with the identical period last yr. The increase was primarily attributable to personnel costs, including a rise within the variety of employees.
At the identical time, selling, general and administrative expenses for the period decreased 19% to $268 million in comparison with the second quarter of 2023. Selling, general and administrative expenses typically include the prices of promoting, selling and delivering an organization's services.
Moderna has up to now managed to spice up investor sentiment about its post-Covid path forward. The company's shares have risen nearly 20% this yr as confidence grows in its pipeline and its messenger RNA platform, the technology utilized in its Covid vaccine and RSV shot.
The biotech company currently has 45 products in development, five of that are in advanced testing phases. This includes its combination vaccine against Covid and flu, which may very well be approved as early as 2025.
Moderna can be developing a standalone flu vaccine, a personalised cancer vaccine with Merck and vaccinations against latent viruses, amongst other products.
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