Investors attempting to forecast which biotech company will create the first vaccine for the novel coronavirus could do much worse than putting their money into Moderna (NASDAQ:MRNA) stock. It appears Moderna could be just a few short weeks away from bringing its vaccine candidate to market.
Thanks to the U.S. government’s Operation Warp Speed program, vaccine candidates are flying through the testing and approvals process in an effort to find a solution to the Covid-19 pandemic.
Through Operation Warp Speed, the government hopes to deliver 300 million doses of an approved vaccine by January 2021.
The Massachusetts-based biotech firm received nearly $1 billion to support and produce its vaccine candidate, which got fast-track designation in May from the Food & Drug Administration.
Moderna stock rode the wave, jumping from less than $20 per share earlier this year to advance nearly 300% year-to-date.
Investors know that if Moderna comes up with a vaccine, those gains will just be the beginning for MRNA stock.
If the drug is approved by the FDA by Jan. 31, Moderna could get $1.525 billion for 100 million doses of the drug. It would get another $600 million if Moderna can demonstrate industrial-scale manufacturing capabilities, and the government has the option to purchase another 400 million doses.
The Latest Developments
Moderna’s vaccine candidate is mRNA-1273. The drug is administered to patients in two doses, 28 days apart.
Currently the drug is in Phase 3 trials in the U.S., where the company has “essentially completed recruitment” of its 30,000 participants, according to a Reuters report. The Phase 3 study is expected to be completed on Oct. 27.
Meanwhile, the FDA’s advisory committee is meeting next week to discuss Covid-19 vaccines. Since Moderna is in the final stages of its Phase 3 trials and it made a presentation to the committee at its August meeting, it wouldn’t be a surprise for Moderna’s candidate to be a topic of that meeting.
The company recently also got a boost in a study published by the prestigious New England Journal of Medicine saying that early-stage data shows that mRNA-1273 can generate antibodies in older and elderly adults at levels comparable to younger people. That finding is huge considering the deadly effect that Covid-19 has shown on older people.
Finally, Moderna announced this week that its mRNA-1273 vaccine is now being reviewed by Canadian health authorities in a rolling submission basis. The rolling submission means that Health Canada, the governing body, will review the submittal even while clinical trials are being completed and data is being collected.
In addition to the drugs earmarked to the U.S., Moderna says it is on track to provide up to 56 million doses of mRNA-1273 to Canada early next year.
The Bottom Line for MRNA Stock
Moderna told investors that it could produce up to 1 billion doses of mRNA-1273, and so far has received about $400 million in deposits.
The price of the vaccine has been set between $32 and $37 per dose for customers with smaller volume agreements. Since the vaccine requires two doses, it would cost between $64 and $74 to vaccinate one person.
Given those rough numbers, Moderna could see revenue $32 billion and $37 billion for 1 billion doses that could be used to vaccinate 500 million people.
If Moderna’s Phase 3 trials result in FDA and international approvals for mRNA-1273, you can expect MRNA stock to skyrocket from here. The growth potential is enormous.
Moderna has an “A” grade in my Portfolio Grader right now, where it carries a strong buy recommendation.
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Source: Investor Place