The mRNA (messenger RNA) technology that powered the rapid development of COVID-19 vaccines is now driving a broader revolution in medicine.
According to Berenberg, this innovative approach has the potential to transform the treatment of multiple ailments, particularly cancer and infectious diseases.
Leading the charge in this field are two companies, BioNTech and Moderna Inc (NASDAQ:MRNA, ETR:0QF), whose contrasting strengths and challenges offer insights into the evolving mRNA landscape.
mRNA works by delivering genetic instructions to cells, prompting them to produce proteins that can fight diseases.
Unlike traditional medicines, mRNA therapies can be quickly customised, making them a versatile tool for tackling a wide range of illnesses. During the pandemic, this technology demonstrated its effectiveness, safety, and scalability, setting the stage for further breakthroughs.
Berenberg’s analysis places a strong emphasis on BioNTech, recommending it as a 'buy' due to its focus on cancer treatments and robust financial health.
The company’s oncology pipeline is particularly promising, with new therapies targeting tumours expected to generate momentum through 2025.
Strategic partnerships have added valuable tools to BioNTech’s mRNA platform, enhancing its ability to explore innovative treatments. With €17.8 billion in cash reserves and investments, the company is well-positioned to advance its most promising projects.
In contrast, Moderna (rated 'hold') faces more immediate challenges despite its long-term potential. The company is spending heavily on research and development, making it less likely to meet its financial targets without raising additional funds or partnering with others.
Moderna’s reliance on infectious disease vaccines, particularly in the United States, leaves it vulnerable to market pressures and political uncertainties. Still, its work on personalised cancer vaccines shows significant promise.
Both companies are riding structural tailwinds, such as the world’s ageing population, which is driving demand for treatments for age-related and infectious diseases. The ability to design flexible, personalised therapies makes mRNA particularly well-suited to these needs.
Berenberg reckons BioNTech's shares are worth $130 - around a 30% premium to the current price. Moderna, by contrast, is valued at $42 - around $2 a share more than the current price.