The headquarters of Moderna Inc. in Cambridge, Massachusetts, USA, on Tuesday, March 26, 2024.
Adam Glanzman | Bloomberg |
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 in the U.S. and international sales may 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 fell more than 20% on Thursday.
The company has begun shipping its respiratory syncytial virus vaccine, called mRESVIA, in 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 as the world emerges from the pandemic and relies less on protective shots and treatments.
Stephane Bancel, CEO of Moderna, told CNBC that there has been “greater intensity of competition” in both 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 year.
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 is referring to the European Union’s massive, newly negotiated Covid vaccine supply contract with Pfizer and his German partner BioNTechHe also referred to the ongoing 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 new products, Bancel said.
Here's what Moderna reported for the second quarter, compared to Wall Street expectations, based on an LSEG analyst survey:
- Loss per share: $3.33 versus an expected loss 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 compared to the same period last year. Moderna reported revenue of $344 million in the same period last year.
The company said the sales decline was partly due to the expected transition to a seasonal Covid vaccine market, where patients typically receive their shots in the fall and winter. However, Bancel said Moderna had a “good spring season” in the U.S. for seniors who are recommended to receive an additional dose of the latest round of Covid vaccinations.
Moderna reported a net loss of $1.28 billion, or $3.33 per share, in the second quarter. In the same period last year, the net loss was $1.38 billion, or $3.62 per share.
Bancel said the company's losses were partly due to progress in cost-cutting and that Wall Street had recorded smaller losses than expected.
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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 same period last year. This included $14 million in write-offs for unused doses of the Covid vaccine and $55 million in costs related to the company's efforts to reduce its manufacturing capacity.
Research and development expenses increased 6% to $1.2 billion in the second quarter compared to the same period last year. The increase was primarily due to personnel costs, including an increase in the number of employees.
At the same time, selling, general and administrative expenses for the period decreased 19% to $268 million compared to the second quarter of 2023. Selling, general and administrative expenses typically include the costs of advertising, selling and delivering a company's products and services.
Moderna has so far managed to boost investor sentiment about its post-Covid path forward. The company's shares have risen nearly 20% this year as confidence grows in its pipeline and its messenger RNA platform, the technology used in its Covid vaccine and RSV shot.
The biotech company currently has 45 products in development, five of which are in advanced testing phases. This includes its combination vaccine against Covid and flu, which could be approved as early as 2025.
Moderna is also developing a standalone flu vaccine, a personalized cancer vaccine with Merck and vaccinations against latent viruses, among other products.
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