modern It reported second-quarter revenue on Thursday that beat expectations, but it slashed its full-year sales guidance, citing lower expected sales in Europe, a “competitive environment” for U.S. respiratory vaccines and the potential for international revenue to be delayed until 2025.
The biotech now expects 2024 product revenue to be between $3 billion and $3.5 billion, down from previous guidance of $4 billion.
The company’s shares fell 10% in premarket trading Thursday.
The company’s respiratory syncytial virus vaccine, called mRESVIA, was approved for use in older adults in May and has since begun shipping the vaccine in the United States. It’s Moderna’s second commercial product after its Covid vaccine, which has seen demand plunge as the world emerges from the pandemic and relies less on protective shots and treatments.
Moderna CEO Stephane Bancel said there was “increased competition” for RSV and Covid vaccines. He noted that mRESVIA is the third RSV vaccine to hit the market after the injectable vaccine. Pfizer and GSKwhich dominated the market last year.
He added that “we have been in very intense discussions with European governments” to obtain supplies of the coronavirus vaccine from Moderna.
But “some countries, just last week, told us that because budgets are very tight… they don’t have the ability to buy more vaccines than they need because they already have another contract,” Bancel said.
He is referring to the European Union Massive renegotiation of COVID-19 vaccine supply contracts and Pfizer and its German partners Biological Technology. He also noted that the ongoing war in Ukraine has strained the government budget.
Still, Moderna expects to return to sales growth in 2025 and break even in 2026 as new products are launched, Bancel said.
Here’s how Moderna reported second-quarter results compared to Wall Street expectations, according to a survey of analysts by London Stock Exchange Group (LSEG):
- Loss per share: $3.33, expected loss of $3.39
- income: $241 million vs. $132 million expected
The company’s second-quarter revenue was $241 million, with sales of its Covid vaccine products down 37% from the same period last year. Moderna reported revenue of $344 million in the same period last year.
The company said the revenue decline was partly due to an expected transition to a seasonal COVID-19 vaccine market, with patients typically receiving vaccines in the fall and winter. But Bancel said Moderna had a “great spring” for seniors in the U.S., recommending they get extra shots with the latest round of coronavirus vaccines.
Moderna reported a second-quarter net loss of $1.28 billion, or $3.33 per share. This compares with a net loss of $1.38 billion, or $3.62 per share, in the same period last year.
Bancel said the company’s losses were smaller than Wall Street expected, in part because of its progress in cutting costs.
Moderna “sold a little more than expected, but the cost savings exceeded Wall Street expectations,” he said. “That’s why I’m very pleased with the progress we’ve made on both fronts.”
Cost of sales was US$115 million, down 84% from the same period last year. This includes a $14 million write-down on unused COVID-19 vaccine doses and a $55 million charge related to the company’s production scale-down.
Research and development expenses increased 6% in the second quarter to $1.2 billion compared with the same period in 2023.
Meanwhile, selling, general and administrative expenses for the period fell 19% to $268 million compared with the second quarter of 2023.
So far, Moderna has managed to boost investor confidence in its path forward post-COVID. The company’s shares are up nearly 20% this year on growing confidence in its pipeline and messenger RNA platform, the technology used in its Covid vaccine and RSV vaccine.
The biotech company currently has 45 products in development, five of which are in late-stage trials. These include a combination vaccine against COVID-19 and influenza, which could be approved as soon as 2025.
Moderna is also developing a standalone flu vaccine, a personalized cancer vaccine that contains Merck and products such as injections targeting latent viruses.
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