Moderna headquarters, exterior view, Cambridge, Massachusetts, USA.
Plexi Images | GHI | UCG | Universal Images Group | Getty Images
Modern On Thursday, it announced plans to cut about $1.1 billion in spending by 2027 and secure approvals for several new products as it charts a path forward after the rapid decline of its Covid business.
The biotech company said it expects 10 new product approvals through 2027. But Moderna said it will also pause work on some products in its pipeline and drop others as it looks to “set our pace” on new research and development spending.
The company aims to cut R&D spending to a range of $3.6 billion to $3.8 billion by 2027, down from $4.8 billion expected by the end of this year, according to a statement.
“We're going to start to see things wind down because there are some studies that we're basically going to put on hold and not start,” Moderna CEO Stéphane Bancel told CNBC, adding that the company is putting its dormant pipeline “on hold.” That refers to a category of viruses that remain inside patients for extended periods without causing any symptoms, but can reactivate and cause serious health complications later in life.
Also on Thursday, Moderna announced positive results from late-stage trials of its respiratory syncytial virus vaccine in high-risk patients. adults ages 18 to 59, with plans to seek approval for that age group this year. It also announced positive data on its standalone experimental flu vaccine for adults 65 and older.
The company made the updates during its annual investor event, Research and Development Day, held Thursday in New York, which focuses on its product pipeline and long-term business updates. The announcement comes about four months after U.S. regulators approved Moderna’s rubella virus vaccine for older people, its second commercially available product after its COVID-19 vaccine.
The company said it now has five respiratory vaccines with positive Phase 3 results and expects to submit three of those vaccines for approval this year. That includes Moderna’s combination vaccine targeting COVID and flu, which it expects to submit for approval in the U.S. this year, along with a new, more effective version of its COVID vaccine.
Moderna also has five non-respiratory products for cancer, latent viruses and rare diseases that could be approved in 2027, the company said in a statement.
The company expects revenue to reach $2.5 billion to $3.5 billion in 2025. Between 2026 and 2028, Moderna expects a compound annual growth rate of more than 25% as it launches new products.
Bancel said the company's success rate in developing drugs from phase one to phase three is “six times higher” than the rest of the biotech and pharmaceutical industry.
“It's really a remarkable achievement that the team has made, leaving us with a lot of drugs that work, so we need to pace ourselves in terms of R&D investment,” he told CNBC.
What's in Moderna's pipeline?
Moderna presented new data on its RSV vaccine, mRESVIA, which is approved in the United States and the European Union for adults aged 60 years and older.
The company said the vaccine met all primary efficacy endpoints in an ongoing phase three study in adults aged 18 to 59 who are at higher risk of severe illness from the virus. No safety concerns were observed, Moderna added.
There are currently no RSV vaccines approved worldwide for young and high-risk adults, such as those with weakened immune systems or underlying chronic diseases like asthma and diabetes. Moderna's main rivals in the RSV space, Pfizer and GSKThey are also seeking expanded approval for the age group.
Bancel said the company plans to use a “priority review voucher” when applying for approval for people ages 18 to 59, which would reduce the time it takes for the Food and Drug Administration (FDA) to review the product to six months instead of 10 months. Moderna expects the agency to authorize mRESVIA for that age group in time for the RSV season in 2025.
“There are millions of people who could benefit… We're also just doing this to be competitive in the marketplace because if you're a big retail pharmacy, you want your product to be available to every customer that comes in,” Bancel said.
But the company is also discontinuing development of its RSV vaccine for infants under 2 years old based on “emerging clinical data.”
Moderna said its standalone flu vaccine candidate, mRNA-1010, produced a higher immune response against the virus compared to an existing flu vaccine in a recent phase three trial. The vaccine has also demonstrated “consistently acceptable safety and tolerability” in three late-stage trials, the company added.
Meanwhile, Moderna said it plans to move its vaccine against norovirus, a highly contagious stomach bug that causes vomiting and diarrhea, into a phase three trial “imminently.” Bancel said he believes the company could finish the study within a year and apply for approval immediately afterward if the data is positive.
“It could be a product that will be launched within two years, which is fantastic because there is currently nothing to treat norovirus,” he said. “A lot of healthcare professionals are infected by their patients.”
Moderna is also partnering with Merck to develop a personalized cancer vaccine, which is being studied in combination with Keytruda in patients with different forms of the disease.
The companies are studying the vaccine in a phase three trial in patients with a deadly skin cancer and are discussing approval with regulators based on data from a mid-stage study of the vaccine.
But Moderna said the FDA has “not supported” a so-called accelerated approval of the vaccine based on existing data. That refers to an FDA designation that approves drugs more quickly if they fill an unmet medical need for serious conditions.
Bancel said that “we will continue to have discussions” with regulators and “we are also generating more data.”
