Moderna Inc (NASDAQ:MRNA, ETR:0QF) is adjusting to life after COVID, having announced several strategic adjustments following declining COVID vaccine sales.
The company announced a reduction in its research and development (R&D) spending, including a 20% cut in R&D expenses and the discontinuation of five drug development programs. According to executives, investment in new vaccines and treatments for rare diseases will also be scaled back.
Earnings results exceed revenue expectations
Thursday’s earnings results exceeded revenue expectations, although Moderna reported that the growth stemmed largely from advancing this year’s updated COVID vaccine shipments to market more swiftly than in 2023.
Moderna said it distributed double the doses within the first week of approval compared to the previous year. Yet analysts like Myles Minter of William Blair expressed caution, suggesting that sales were “pulled forward” and therefore may not sustain a significant increase.
Moderna’s total product sales in 2023 reached $2.2 billion, leaving projected fourth-quarter sales between $800 million and $1.5 billion. Despite an initial stock rise of up to 9% Thursday, the gain later moderated to 1%.
Additionally, Moderna’s new mResvia vaccine, aimed at combating respiratory syncytial virus (RSV), faces a challenging market dominated by competitors GSK and Pfizer. Early-year contracts signed by these companies have led to substantial vaccine inventory, slowing mResvia’s market entry.
Moderna CEO Stéphane Bancel noted that existing inventory levels and prioritised COVID vaccine distribution have impacted mResvia sales. The company stated it plans to expand mResvia's usage beyond older adults and expedite its review for high-risk adults aged 18 to 59 using a priority review voucher.
In another shift, Moderna confirmed that president Stephen Hoge will oversee the company’s commercial operations, a role previously managed by Bancel.