Moderna Therapeutics Inc (NASDAQ:MRNA)'s upcoming update on its cancer vaccine trial in patients with adjuvant melanoma will only prompt a modest positive stock reaction, according to analysts at Jefferies.
The drugmaker is expected to provide an update on the cancer vaccine (INT) trial at 51 events by the year-end, following its previous first interim update at 40 events.
The analysts wrote in a note to clients that they expect the data to be in line and further show at least a 45% benefit in recurrence-free survival compared with immunotherapy, similar to the first interim update.
“The base case here is that efficacy data should continue to be in line with the previous 40 events data, in which INT/Keytruda combination shows a 44% benefit versus Keytruda monotherapy,” they wrote.
“At 51 events, base case events occur in both arms and not a huge shift in the overall recurrence-free survival benefit. Ideally, we want to see more events in the pembro monotherapy arm which would lead to larger separation between the curves and drive greater benefit with more time.”
The bull case is that Moderna speaks with the Food and Drug Administration (FDA) and file for accelerated approval is unlikely, the analysts noted.
“While INT data will likely be an incremental positive for the stock, and we expect modest upside (likely flat, in our view) and focus for trading remains on covid sentiment until (1) flu, respiratory syncytial virus (RSV) and combos sales start to pick up and potentially make an impact on revenue growth in 2025 and beyond and (2) a string of pipeline developments in 2024 such as Phase 1 VRTX CF, Phase 3 CMV and Phase 3 flu and Covid combo data coming by first half of 2024 as well,” the analysts wrote.
The Jefferies analysts have a ‘Buy’ rating on the stock and a US$100 price target.
Moderna shares traded up 3.4% at US$89 on Wednesday afternoon. The stock has shed more than 50% of its value in 2023.
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