WHAT YOU NEED TO KNOW!
- Despite the drop in sales, Moderna is preparing to shift to commercial distribution of the shots, with discussions ongoing with commercial customers for vaccine distribution
- Moderna plans to develop a new COVID-19 booster shot in preparation for a fall booster campaign and has $5 billion in advance purchase agreements for its COVID-19 vaccines for 2023
- The decrease in volumes pushed sales 29% lower to $5.1 billion in the last three months of 2022.
Moderna, a pharmaceutical company based in Cambridge, Massachusetts, reported lower revenue and earnings in the fourth quarter of 2022 due to lower demand for its COVID-19 vaccines. The decrease in volumes pushed sales 29% lower to $5.1 billion in the last three months of 2022, but the sales still exceeded analysts’ expectations, according to FactSet. Moderna is preparing to shift to commercial distribution of the shots, holding contract discussions with commercial customers for the vaccines, and expecting to distribute about 100 million doses on the commercial market this year.
Arpa Garay, Moderna’s chief commercial officer, said the company is also holding COVID-19 vaccine contract discussions with federal agencies, including the Defense Department and Veterans Affairs. However, some Democratic senators, including Bernie Sanders, have criticized Moderna’s pricing plans because the company received significant financial and scientific assistance from the federal government in designing and developing the vaccine.
Moderna CEO Stéphane Bancel said in January the company was considering a range of $110 to $130 per dose, which is significantly higher than the per-dose cost range of $15 to $26 in the federal supply contracts. Moderna did not disclose a specific commercial price for the vaccines. Nevertheless, people with insurance will have no out-of-pocket costs for the vaccine, whether they receive it at a doctor’s office or pharmacy. Moderna plans to start a patient-assistance program to provide the vaccine at no cost to uninsured or underinsured people in the U.S.
Moderna reported $18.4 billion in COVID-19 vaccine sales for full-year 2022 and has $5 billion in advance purchase agreements for its COVID-19 vaccines for 2023, with the potential for additional sales opportunities in the U.S., Europe, Japan, and other markets. Moderna expects to develop a new COVID-19 booster shot later this year that better targets circulating variants, in preparation for a fall booster campaign.
Moderna’s Q4 costs shot up due to higher royalties, inventory write-downs from expired COVID-19 products, a loss on firm purchase commitments, and expenses tied to unused manufacturing capacity. Research and development expenses, meanwhile, soared 87% in the fourth quarter to $1.2 billion as the company spent more on clinical trials and development of vaccines against respiratory syncytial virus, seasonal flu, and cytomegalovirus.
Moderna also announced that the Food and Drug Administration granted a “breakthrough therapy designation” for its experimental cancer vaccine, which it is codeveloping with Merck & Co. If the FDA approves it, Moderna could launch the vaccine in late 2023 or early 2024. Moderna also plans to apply by midyear for FDA approval of its RSV vaccine, based on a recent study showing it helped prevent RSV disease in older adults.